Thursday, May 19th, 2016

Market crisis 2

Markets exploded to the upside with 400 points push late in the trading day on the news of a Resolution Trust formation to contain bad debt and toxic properties of lenders and a way to end financial crisis.  It should be noted that VIX was trading at 42 prior to this explosive rally and those levels have often been precursors to a bullish market action.  A sharp spike and a downward move in VIX follows major market rallies and bullish moves. Market may have put a bottom here, most likely. We shall see in the next few days. However Market found a Catalyst today and within one hour NASDAQ shot up 103 points and NDX 71 points. Leading stocks like BIDU up 20 points, GS up from 88 to 115. SST and MS also  managed to get out of the deathly spirals.

Its hoped that Congress may author some concessions and form a RTC type bail out as done during the Savings and Loan crisis in mid 1980s. We just have to wait and see. Also naked shorting being outlawed is another great factor in keeping these markets above water.

Tomorrow is options expiration day on stocks and we would be looking at major stocks like OIH, POT, BIDU, AAPL, CME, GOOG and others for stock pinning. Cannot say how this will pan out this month, since nothing is normal in this market. Stock pinning is a phenomena that occurs on option expiration days and stocks end up on certain strikes without any movement. Read more on stock pinning in later posts.

Any viable trades will be posted here around market open on this site for all to see.. please check back here early morning if there are any viable trades..


2 Responses to “Market crisis 2”
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  1. […] that nation 5 th largest financial institution Washington Mutual went under ! Nothing was safe. The panic had set in quite hard and gripped every American from coast to coast. People were lining up outside banks taking out cash. […]

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