Stock and Trading Advice: WARNING TO OPTIONS TRADERS LOOKING AT NETFLIX EARNINGS

One of the hardest things for me to remember is not to believe everything I see. I am a sucker for the latest “can’t lose” strategy supported by the experts. This morning I ran across a trade that looked too good to be true. I think it is, but I think it is instructive to walk through the potential hidden land mine. The event is the Wednesday afternoon release of NFLX earnings but there is a hidden trap for option traders using one commonly used earnings play structure.

The construction of the play is that of a “double calendar” spread. The underlying profit engine is an attempt to exploit the routinely seen spike in implied volatility (IV) of the options series most closely following earnings release. In this case, NFLX has weekly options which expire 48 hours after the scheduled announcement.

In order to understand the situation, let’s walk through the components step-by-step. First, is the routinely observed spike in IV seen as earnings release approaches present? As shown in the options pricing matrix below, the IV of the weekly options is substantially higher than the next series in time, the February monthlies:

Next, we need to get an idea of the magnitude of the price movement expected by option traders. This price range can be imputed from the break even points of the at-the-money straddle in the front most options. As shown in the graph below, this analysis gives a current expected price range of 167-203 following earnings release.

Now let us consider a double calendar spread with strikes selected to encompass this anticipated price range. To review quickly, a calendar spread consists of selling a short dated option while buying a longer dated option at the same strike price. An example of such a trade in NFLX is presented below:

That looks pretty sweet, right? We have projected break even points of 147.3 and 238.86 and a probability of profit (P.P.) of 100%. So all we have to do is put this on, wait for earnings, and barring any huge surprise, we take profit of 100% or more home.

What could possibly go wrong? Unfortunately there is a high probability of a sequence of events that will totally erase any profits and likely result in a loss. Go back and look at the option pricing matrix above and focus on the IV of the options we are buying. These options trade at a volatility of 60%. Is that high or low? You tell me from this historic graph of volatility in NFLX options:

As you can see, the current level of volatility that you are buying in the long legs of the calendar is quite elevated on a historical basis. Furthermore, the spread between statistical (historical) and implied volatilities has rarely been greater. This combination of events sets up a high probability of a “volatility crush” on the options you hold long as part of the spread. The moving parts of this crush are:

1. Cessation of the “bleeding” of juiced IV from the weeklies into the monthly series as the weekly option IV deflates massively.

2. Convergence of IV toward the value of historical volatility in order to close the huge divergence in the levels currently present.

This situation sets up a high probability for a negative impact on the trade which will almost certainly result in a loss. Do I know these events will transpire? Absolutely not, and I may be 100% wrong. Survival as an options trader is all about recognizing high probability events and structuring trades accordingly. No free cheese here; time to move along to the next trade.

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J.W. Jones

How a Simple Line Can Improve Your Trading Success

Elliott Wave International’s Jeffrey Kennedy explains many ways to use this basic tool
January 19, 2011

By Elliott Wave International

The following trading lesson has been adapted from Jeffrey Kennedy’s eBook, Trading the Line – 5 Ways You Can Use Trendlines to Improve Your Trading Decisions. Now through February 7, you can download the 14-page eBook free. Learn more here.

“How to draw a trendline” is one of the first things people learn when they study technical analysis. Typically, they quickly move on to more advanced topics and too often discard this simplest of all technical tools.

Yet you’d be amazed at the value a simple line can offer when you analyze a market. As Jeffrey Kennedy, Elliott Wave International’s Chief Commodity Analyst, puts it:

“A trendline represents the psychology of the market, specifically, the psychology between the bulls and the bears. If the trendline slopes upward, the bulls are in control. If the trendline slopes downward, the bears are in control. Moreover, the actual angle or slope of a trendline can determine whether or not the market is extremely optimistic or extremely pessimistic.”

In other words, a trendline can help you identify the market’s trend. Consider this example in the price chart of Google.

That one trendline — drawn between the lows in 2004 and the lows in 2005 — provided support for a number of retracements over the next two years.

That’s pretty basic. But there are many more ways to draw trendlines. When a market is in a correction, you can draw a trendline and then draw a parallel line: in turn, these two parallel lines can create a channel that often “contains” the corrective price action. When price breaks out of this channel, there’s a good chance the correction is over and the main trend has resumed. Here’s an example in a chart of Soybeans. Notice how the upper trendline provided support for the subsequent move.

For more free trading lessons on trendlines, download Jeffrey Kennedy’s free 14-page eBook, Trading the Line – 5 Ways You Can Use Trendlines to Improve Your Trading Decisions. It explains the power of simple trendlines, how to draw them, and how to determine when the trend has actually changed. Download your free eBook.

What Really Moves the Markets: News? The Fed?

By Elliott Wave International

“There is no group more subjective than conventional analysts, who look at the same ‘fundamental’ news event a war, interest rates, P/E ratio, GDP, economic policy, the Fed’s monetary policy, you name it and come up with countless opposing conclusions. They generally don’t even bother to study the data.” – EWI president Robert Prechter, March 2004 Elliott Wave Theorist.

If you watch financial news, you probably share Bob Prechter’s sentiment. How many times have you seen analysts attribute an S&P 500 rally to “good news from China,” for example — only to focus on a different, supposedly bearish, news story later the same day if the rally fizzles out?

You need objective tools to make objective forecasts. So, we put together a unique resource for you: a free 118-page Independent Investor eBook, where you see dozens of examples and charts that show what really creates market trends.

Here’s a quick excerpt. For details on how to read the entire Independent Investor eBook online now, free, look below.


Independent Investor eBook
Chapter 1: What Really Moves the Markets? (excerpt)

Action and Reaction

In the world of physics, action is followed by reaction. Most financial analysts, economists, historians, sociologists and futurists believe that society works the same way. They typically say, “Because so-and-so has happened, such-and-such will follow.” … But is it true?

Suppose you knew for certain that inflation would triple the money supply over the next 20 years. What would you predict for the price of gold?

Most analysts and investors are certain that inflation makes gold go up in price. They view financial pricing as simple action and reaction, as in physics. They reason that a rising money supply reduces the value of each purchasing unit, so the price of gold, which is an alternative to money, will reflect that change, increment for increment.

Figure 4 shows a time when the money supply tripled yet gold lost over half its value. In other words, gold not only failed to reflect the amount of inflation that occurred but also failed even to go in the same direction. It failed the prediction from physics by a whopping factor of six, thereby unequivocally invalidating it.

Investors who feared inflation in January 1980 were right, yet they lost dollar value for two decades… Gold’s bear market produced more than a 90% loss in terms of gold’s average purchasing power of goods, services, homes and corporate shares despite persistent inflation!

How is such an outcome possible? Easy: Financial markets are not a matter of action and reaction. The physics model of financial markets is wrong. …

Cause and Effect

Suppose the devil were to offer you historic news a day in advance. … His first offer: “The president will be assassinated tomorrow.” You can’t believe it. You and only you know it’s going to happen. The devil transports you back to November 22, 1963. You short the market. Do you make money? …

[…continued in the free 118-page Independent Investor eBook]


Read the rest of the eye-opening report online now, free! All you need is a free Club EWI profile. Here’s what else you’ll learn:

  • The Problem With “Efficient Market Hypothesis”
  • How To Invest During a Long-Term Bear Market
  • What’s The Best Investment During Recessions: Gold, Stocks or T-Notes?
  • Why “Buy and Hold” Doesn’t Work Now
  • How To Be One of the Few the Government Hasn’t Fooled
  • How Gold, Silver and T-Bonds Will Behave in a Bear Market
  • MUCH MORE

Long-Term Bonds: The Best Possible Investment? Think Again

A free Club EWI report reveals why bonds do not provide shelter from the storm
December 23, 2010

By Elliott Wave International

TREASURIES — the very name conveys a thing that is secure, protected, and will appreciate over time. Otherwise, it’d be called something like “TRASHeries” or “Mattress Stuffers.” Then, there’s the official seal of the US Department of Treasury: its image of a scale and a key symbolize “balance” and “trust.”

And, finally, there’s the mainstream economic experts who have it on good authority that long-term bonds increase in value during financial instability and uncertainty.

On this, the following news items from November-December 2010 reflect the enduring faith in fixed-income assets as the ultimate safe-havens:

  • “Bonds Tumble On Signs of Economic Recovery” (Reuters)
  • “US Treasury Prices Rise as traders positioned for negative headlines….” (Associated Press)
  • “Treasury’s rise as investors sought shelter in safe haven assets amid rising fears about sovereign debt woes in the eurozone. The slow motion train wreck is likely to play out over year end as each country plays musical chairs with solvency. The market’s concern here is ‘What is next?’ The 10-year Treasury yield will fall if the problems get worse from here.” (Wall Street Journal)

There’s just one problem with this notion: namely, bonds (of any denomination) do NOT have a built-in disaster premium. This is the myth-busting revelation of the latest, free report from Elliott Wave International. The resource titled “The Next Major Disaster Developing For Bond Holders” includes a thoughtful selection of various EWI publications that expose the very real vulnerability of bond markets to economic downturns.

The premier study on the subject comes from Chapter 15 of EWI President Robert Prechter’s book Conquer The Crash by way of this memorable excerpt:

“If there is one bit of conventional wisdom that we hear repeatedly with respect to investing, it is that long-term bonds are the best possible investment [in downturns]. This assertion is wrong. Any bond issued b a borrower who can’t pay goes to zero in a depression. Understand that in a [major contraction], no one knows its depth and almost everyone becomes afraid. That makes investors sell bonds of any issuers that they fear could default. Even when people trust the bonds they own, they are sometimes forced to sell them to raise cash to live on. For this reason, even the safest bonds can go down, at least temporarily, as AAA bonds did in 1931 and 1932.

The first chart (see below) shows what happened to bonds of various grades in the deflationary crash. And the second chart (see below) shows what happened to the Dow Jones 40-bond average, which lost 30% of its value in four years. Observe that the collapse of the early 1930s brought these bonds’ prices below — and their interest rates above — where they were in 1920 near the peak in the intense inflation of the ‘Teens.”


That’s just the tip of this myth-busting report. “The Next Major Disaster” uncovers flaws in other widely-accepted bond lore, including these two assumptions:

  • High -yield bonds rise during economic expansions
  • AND — municipal bonds provide a steady refuge in times of economic stress.

Read more about Robert Prechter’s warnings for holders of municipals and other bonds in his free report: The Next Major Disaster Developing for Bond Holders. Access your free 10-page report now.

Investing Advice: Trading the Holiday Grind

It’s that time again when volume dries up and prices rise into the new year. A lot of individuals are scrambling to prepare for the holidays, even though we had a year to prepare. The big money has already done most of their year end shuffling and will be taking it easy until January.

The market is overbought and sentiment readings are at extreme levels which in the past have been the start of large sell offs and even bear markets. While I am keeping a close eye for a top, there is not much we can do but stay long stocks and commodities until the market tips its hand and distribution selling is in control. The U.S. federal government is the only wild card going into year end that should be on traders’ radars. They have been doing a great job boosting prices in the equities and commodities market, but can they continue to hold things up when the big money and the proverbial herd start unloading positions in 2011?   — Please, Click here to read the rest.

Gold and Stock Advice: Playing new fear in equities markets

So far this week we have been seeing fear creep in the equities market. This Wednesday we started to see fear (green indicator) reach a level which tells me to start looking for the market to bottoming. I do follow a few other charts and indicators which warn me of a possible trend reversal (high probability setup) before it takes place but the US Dollar and selling volume are key.

As we all know, when the market is trying to top and roll over it tends to be more of a process than a couple day event. It’s this lengthy topping process which has a lot of choppy price action sucking traders into a position much to early or shakes you out of the position before the market does what you anticipated. Knowing that tops tend to drag out for an extended period of time is critical for an options trader simple because of Theta (time decay)

On the flip side, bottoming is more of an event because it tends to happen after a strong wave of panic selling. Fear is the most powerful force in the market (other than the Fed/Manipulators.. but that’s another topic). That being said, when you know what to look for in bottoms you can generally see the market starting to bottom and prepare for it. — Read More Here

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Disclaimer: Quite bluntly, I post these articles to make money; period. The posting of this and other articles is in no means to be considered a endorsement of the ideas and investment strategies. In other words, if you try this and lose your butt; do not come crying to me or wanting me to refund your money. Because it is not going to happen, period.

New Report: It’s Dangerous to Diversify — Find Out Why

New Report: It’s Dangerous to Diversify — Find Out Why

A free report from Elliott Wave International reveals the risks of portfolio diversification
By Elliott Wave International

Despite near-unanimous endorsement among mainstream advisors, the strategy of portfolio diversification has a huge, glaring flaw: Namely, when large sums of liquidity begin to flow into global investment markets, formerly disparate trends become strongly correlated. And markets that go up together ultimately go down together; in turn, the value of diversified portfolios goes down with them. Read more.

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Disclosure: If you follow the link and sign up, I get a small amount of compensation at no extra cost to the customer.

Disclaimer: Quite bluntly, I post these articles to make money; period. The posting of this and other articles is in no means to be considered a endorsement of the ideas and investment strategies. In other words, if you try this and lose your butt; do not come crying to me or wanting me to refund your money. Because it is not going to happen, period.

Personal Advice from ME: If you are small time stock investor, GET OUT NOW!

…and here is why….

This comes via Gateway Pundit, who is one hell of a great blogger:

The story via the U.K. Telegraph:

US Treasuries last week suffered their biggest two-day sell-off since the collapse of Lehman Brothers in September 2008. The borrowing costs of the government of the world’s largest economy have now risen by a quarter over the past four weeks.

Such a sharp rise in US benchmark market interest rates matters a lot – and it matters way beyond America. The US government is now servicing $13.8 trillion (£8.7 trilion) in declared liabilities – making it, by a long way, the world’s largest debtor. Around $414bn of US taxpayers’ money went on sovereign interest payments last year – around 4.5 times the budget of America’s Department of Education.

Debt service costs have reached such astronomical levels even though, over the past year and more, yields have been kept historically and artificially low by “quantitative easing (QE)” – in other words, Federal Reserve Chairman Ben Bernanke’s virtual printing press. Now borrowing costs are 28pc higher than a month ago, with the 10-year Treasury yield reaching 3.33pc last week, an already eye-watering debt service burden can only go up.

Few on this side of the Atlantic should feel smug. The eurozone’s ongoing sovereign debt debacle has pushed up Germany’s borrowing costs by 27pc over the last month – to 3.03pc. The market has judged that if Europe’s Teutonic powerhouse wants the single currency to survive, it will ultimately need to raise wads of cash to absorb the mess caused by other member states’ fiscal incontinence…

Some say that growing signs of a US economic recovery are positive for stocks, which means money is being diverted out of Treasuries, so lowering their price, which pushes up yields. That’s wishful thinking. Sovereign borrowing costs have just surged in the US – and therefore elsewhere – because a politically-wounded President Obama caved-in and extended the Bush-era tax cuts, combining them with a $120bn payroll tax holiday…

The market is increasingly alarmed at the rate of increase of the US government’s already massive liabilities. America’s government debt is set to expand by a jaw-dropping 42pc over the next few years, reaching $19.6 trillion by 2015 according to Treasury Department estimates presented (amid very little fanfare) to Congress back in June. Since then, government spending has risen even more. So US debt service costs, like those of many other Western nations, are expanding rapidly in terms of both the volumes of sovereign instruments outstanding, and the yields on each bond.

You know what that means? It means that if you are a small time investor; that you need to get out of the Market NOW! This could have a huge impact on the market, and you could lose very big. I do virtual trading and so far, I have done well on my trades. But I am not about to lose my shirt, so, I ordered a sell off of everything. Now the big time guys will be able to afford to ride this out, because they have the wealth to spare. But the small time people will get burned. The best thing I can tell you small times investors, is to dump your shares and put it all into Gold. That would either be into EFT‘s or real actual Gold.

Disclaimer: I do not claim to be a expert on the subject of stocks, trading or even Gold. However, it does stand to reason that when such news as this is report, that it will affect the U.S. markets and the United States financial system. I do however, promote a great investment advice service called Elliotwave. You might want to check it out.

Investment Advice: How a “Dull” Investment Can Be a Great Investment

How a “Dull” Investment Can Be a Great Investment

…until it isn’t any more. An important story for today’s bond investors.

December 9, 2010

By Elliott Wave International

I spent my childhood discussing the stock market at the dinner table. My dad was a stock broker, and he loved to “tell the story” of the stocks he recommended to customers — a story that included critical information about the industry, the products, earnings, and the outlook for the future. Most children might find it dull, but I was mesmerized.

As I got older and talked with friends about investing, I’d light up when the topic was stocks. Who in the world couldn’t get excited about analyzing companies to decide which ones could make you money! When the conversation turned to bonds, however, I would shut down. Bonds? How dull; how utterly boring. There’s no story to tell, no industry trends to follow. I saw bonds as an interest check every six months, then a return of principal when they mature. BORING.

Over the past few years, I’ve read article after article about investors getting out of the stock market in favor of bonds. I understood the reasons for getting out of the stock market, but the thought of moving into bonds baffled me. Interest rates were very low, and I knew that when the rates started going up, bond prices would go down; a simple inverse relationship. I started investing in the mid-80s, when rates were at the highest point of the past 50 years — who would buy bonds now, when yields are at the lowest levels in half a century? There’s no place for your principal to go but down, I thought.

So I went back and talked with my friends some more, to see if there was something I was missing with these “dull investments.”

Turned out, my friends had moved their money into bonds after they lost over 30% in stocks during 2008. They told me that bonds had gone up in value. I was astonished.

So I started looking into it. They were right! I thought bond yields could go no lower than they were two years ago, yet they did, In turn, that brought the prices — i.e., the principal on their investment — up!

I asked what kind of bonds they got into. “High-yield bond funds,” was the answer. What kind of bonds are these funds invested in? To this question I got blank stares. How long do you plan on staying in these funds? This got the reply I was afraid I’d hear: “Why would we get out when they are so much safer than stocks?” That’s when my new interest in these once boring investments turned to fear — for my friends.

First of all, the simple idea that a rise in interest rates would cause their principal to fall worried me. But my greater fear was that they did not even know what types of bonds they were invested in!

Elliott Wave International’s president Robert Prechter has followed this new investment trend closely in his monthly Elliott Wave Theorist. This quote is from the October 2010 issue:

A fifth consecutive major disaster is developing for investors. History shows that investors have been attracted like moths to a flame to four consecutive pyres: the NASDAQ in 2000, real estate in 2006, the blue chips in 2007 and commodities in 2008. Now they are flitting across the veranda to a mesmerizing blue flame: high yield bonds.

Bonds pay high yields when the issuers are in deep trouble and cannot otherwise attract investment capital. The public is chasing a large return on capital without considering return of it.

You can learn more about what Prechter’s market analysis says for bond investors now — free. We’ve recently released a 10-page report, “The Next Major Disaster Developing for Bond Holders” free to members of Club EWI.Discover why Prechter says that, “The public always does the wrong thing.” Follow this link to access this free online report right now.

Gold & Stock Trading Advice: Is The Herd Trading Gold & SP500?

Over the past 2 weeks we have seen the market sentiment change three times from extreme bullish to bearish and back to bullish as of today. Normally we don’t see the herd (average Joe) switch trading directions this quickly. Over the past 10 years I found that the average time for the herd to reach an extreme bullish or bearish bias takes between 4-6 weeks in length. It is this herd mentality which makes for some excellent trend trading opportunities. But with the quantitative easing, thinner traded market, and lack of trading participants (smaller herd) I find everyone is ready to change directions at the drop of a hat.

The old school traders/investors who don’t use real-time data or charts, and who dabbled in stock picks, and options trades here and there have mostly exited the trading arena from frustration or losing to much money. This group accounted for a decent chuck of liquidity in the market and was also the slowest of the herd to change directions.

The new school, today’s smaller herd is much more aggressive and quicker to act on market gyrations. I think this is because the only people left in the market are those who make a living pulling money from the market and those who feel they are really close to mastering the stock market. It is these individuals who are using trading platforms with real-time data, charts and scanners to help get a pulse on the market so they can change directions when the big boys do. I feel this is the reason why the market is able to turn on a dime one week to another over the past 8 months… The easy prey (novice and delayed data traders) are few and far between and the fight to take money for other educated traders seems to be getting a little more interesting to say the least.

Anyways, enough about the herd already…

It’s been an interesting week thus far with stocks and commodities. The week started with a large gap up only for strong selling volume to step in and reverse direction the following day. It is this negative price action that starts to put fear into the market triggering a downward thrust in the market. During an up trend which we are in now, I look for these bearish chart patterns to form as they tend to trigger more selling the following days which cleanses the market of weak positions. Once a certain level of traders have been shaken out of their positions and are entering positions in order to take advantage of a falling market, that’s when we get the next rally, catching the majority of traders off guard as they panic to buy back their short positions. It’s this short covering which sparks a strong multi day rally and kicks off the new leg up in the market.

Currently we getting some mixed signals. The market sentiment is the most bullish it has been since 2007, just a little higher than the Jan & March highs this year. This makes me step back and think twice about taking any sizable long positions. Any day now the market could roll over. Another bearish signal is the fact that we just had a very strong reversal day for stocks and metals to the down side. That typically leads to more selling.

But if we look at the positive side of things, the trend is still up, this is typically a strong time for stocks as we go into Christmas/Holiday season, also the market breadth is really strong with the number of stocks hitting new highs has really taking off.

SP500 – Daily Chart

Below you can see the reversal candles along with short term and intermediate support levels. Although the market sentiment is screaming a correction is near, we must realize that sentiment can remain at this level for an extended period of time while the market continues to trend. This is one of the reasons why we say “The Trend Is Our Friend”.

I am hoping for a pullback and would like to see market sentiment shift enough on an intraday basis to give us a low risk entry point.

Gold – Daily Chart

A reversal candle is seen as a sell signal or a profit taking pattern. Short term aggressive trades use these to lock in quick price movements. With so many traders watching gold, it caused a flood of sell orders to push gold down today.

Mid-Week Conclusion:

In short, each time we see some decent selling in the market its get bought back up. Today was another perfect example as we had an early morning sell off, then a light volume rally for the second half of the session and a end of day short squeeze during the last 30 minutes. Gold has pulled back to the first short term support level. Because of the large following in gold I would like to see if there will be another day of follow through selling before possibly looking to take a trade.

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For more stock and gold trading advice, please, check out The Oil and Gold Guy’s website!

Yes Please: Ron Paul says Wikileak the Fed!

Via Alternative Right:

Update: Thank you to voters at Reddit! You all are amazing… :D

Here’s my stats screen as of a few hours ago:

Thanks so much you all. I will try to continue to post stuff like this, that everyone over at Reddit can enjoy. :)

Stock, Gold and Oil Trading Advice: Gold/Silver – Controlling Your Trades, Money & Emotions

Last week we had typical pre-holiday light volume trading going into US Thanksgiving. The previous week I warned every one to trade with extreme caution because of the light volume and the fact that the market is on the verge of a sizable drop for both stocks and commodities. Any price action could not be taken seriously because of the light volume. We will not know until later this coming week what the big money wants to do… Buy or Sell, also what the manipulators will do… Seems like there are a lot of wild cards out there with Europe issues and both unemployment and payroll numbers out on Friday morning.

Below are a few charts showing my intermediate term outlook for gold and silver.

Gold & Silver Futures – Daily Chart
You can see both metal are showing a possible reversal head and shoulders pattern. While they have yet to confirm and close below the neck line we must be aware of this pattern and the risk/potential it provides us with. Both metals are still in an uptrend but showing signs of weakness.

US Dollar Index – Weekly Chart
This chart is not really that helpful for trading stocks, commodities or options right now but I wanted to post it because it allows me to show you how I analyze the market and my trades.

As you can see, the past 3 weeks have been in a strong uptrend reaching the first resistance level. The point of this chart is to show you that if you step out to the next longer time frame you can get a solid feeling of where an investment will find major support and resistance levels. Any investment not matter if it’s a stock, commodity or currency, if the price is trading in the middle of a large range like this chart you should not be taking large positions because it almost becomes a 50/50 bet on the market which is not a good winning strategy unless you are very experienced at managing your trades and money.

If you are going to trade then you want to focus on the underlying trend and you do that by looking at the next larger time frame. For example: if you focus on trading the daily chart, then you must step back each week and review the weekly chart to be sure you are trading with the underlying trend which is up for the dollar right now.

Weekend Trading Ideas:
Tuesday morning we saw the SP500 gap lower and continue to sell off. Traders started panicking out of their long positions and we could see it using the intraday market internals charts, which I cover each morning in the pre-market trading videos. Me being a contrarian (buying into market fear, selling into market strength) I used that high level of fear in the market along with the expected light volume holiday week ahead as an excuse to book profits near the lows on SP500 using the SDS bear fund allowing us to profit from the falling market. I feel we are going to have some crazy moves on the markets going into year end and it should be a lot of fun if done correctly.

Trading in general is a very difficult task especially if you are doing it for a living and planning on using your monthly income to pay bills, salaries etc… We all know the stress which comes with trading and if do not have a solid trading strategy, rules and cannot properly manage yourself (emotions) then you are most likely running into problems like over-trading, getting shaken out of trades easily, and taking bigger risks than your account can handle. Each of these cause more traders to blow up their accounts and big up on trading.

I am giving away my book on how you can control your trades, money and emotions. This short and to the point guide is full of my trading techniques, tips and thoughts which will help you get a handle of your emotions turning the market noise into music.

For great stock, gold and oil trading tips; Please, click here to sign up for this great service for the day trader!

Video: Max Keiser’s Call: Crash JP Morgan Buy Silver

This comes via GoldSilver.com:

Quote:

Mike Maloney was recently in Europe working on his next top-secret project. While passing through France, Mike got the chance to visit with the one and only Max Keiser.

Intelligent, witty, and never bashful, Max Keiser is pure financial entertainment. With over 25 years of experience with markets and finance, Max often draws from first hand experiences when providing his listeners explicit insights on how the financial markets truly operate.

He has been described as a film producer, a journalist, and as JP Morgan and friends are now finding out, an activist investor with powerful ideas on how the masses can help themselves in taking their financial power back.

The Video:

The time in invest in gold and silver is now! Click here to find out how!

Stock Advice: S&P 500, Treasuries, Gold, & Dollar are At Key Price Levels

A new article by a new author:

Thursday was another example of Mr. Market playing games with traders and investors as equities and precious metals took part in a strong rally. Some market prognosticators noted short-term oversold conditions across the board while others discussed the potential for a strong reversal that could potentially take out recent highs. In addition to the regular banter, to the average retail investor the market sure looks rigged when the government decides to sell a large stake in a massive IPO offering and a shaky tape suddenly becomes stronger than garlic.

There is a lot going on in the news as of late, and the expiration of the Bush tax cuts looms large on the minds of many, particularly small business owners. So the real question becomes, what should traders be watching or paying attention to before the light volume Thanksgiving week? The answer is simple, watch the tape! The market will provide plenty of clues and it will eventually tip its hand, experienced traders will wait for this process to unfold.

At this point in time, it is a bit early to begin making predictions as to which direction the equities market will go. What we do know is that the market was oversold in the short-term, so this could be a pause before prices turn lower. In contrast, this could be the beginning of another bullish move breaking recent highs on its way to a “Santa Claus” rally. My stance is neutral at this point in time; S&P 1200 should offer significant overhead resistance while S&P 1170 / 50 period moving average is near term support. The chart listed below illustrates these key levels:

S&P 500

If price were to break out above S&P 1200 on strong volume, it is likely that we will see a retest of the recent highs around the 1220 area. Consequently, if price tests the S&P 1170 area and fails price will likely be magnetized to the 1140-1150 area. We will have our answers in due time, but until a definite direction is known, patience is warranted.


Treasuries

As discussed in my previous article, the ProShares Ultra Short 20+ year treasury ETF (TBT) bounced off of the 36 level and put on a short lived rally only to settle toward the bottom 1/3 of its recent price range. After the recent breakout, it would be constructive to see TBT consolidate before confirming a direction. The chart below shows the key levels on TBT:

U.S. Dollar

Instead of illustrating a gold chart, let us focus our attention on the U.S. Dollar Index. The chart below shows the dollar has pulled back and is now testing the 50 period moving average. I am anticipating a retest of the recent breakout over double tops and this key level is illustrated below. If support holds firm, higher prices for the U.S. Dollar in the near term will be likely.

The Contrarian Trade

Thursday’s price action in the S&P 500 offers a great example of the power of options, which are traditionally overlooked by most equity traders or investors. While I did not personally enter this trade, I did enter a short position with tight stops around the S&P 1197 level using futures contracts for a short term trade. I was looking for a short term decline which we subsequently received in the aftermarket and my limit orders were triggered.

The option trade that I discussed with one of my trading buddies and mentor, involved getting short Apple (AAPL) when its price was around $309.50/share. While I did not place this trade as I felt I had plenty of short side exposure via my e-mini futures position, the trade would have worked quite well. So the trade listed below is not a recommendation, but an illustration of how options can be a contrarian traders’ best friend.

AAPL has been trading in the $300 – $320 per share range for several weeks having broken out above $320 only to be smacked down into the range. During the recent selloff, AAPL crossed down through the $300 level only to encounter strong buying that pushed it above the key $300 area by the close of trade that day. Thursday’s rally had AAPL trading above $309.50/share and the 20 period moving average was right around the 310 level as can be seen from the chart below.

The 20 period moving average provides an adept option trader with a key level which he/she can define the risk of a short position using options. Through the utilization of a contingent stop based on AAPL’s stock price, a trader using this setup could place a stop around the $311.25 area to define their ultimate risk. As of Thursday, the AAPL weekly options that expire November 26 began trading.

The trade listed below is a put debit spread:

Buy 1 AAPL Nov. 26 310 Weekly Put – $5.00 / contract based on Thursday’s close
Sell 1 AAPL Nov. 26 300 Weekly Put – $1.47 / contract based on Thursday’s close

AAPL stock closed around $308.43 / Share

The profitability chart reflecting this trade is below:

The maximum risk this trade has per leg was around $350, however through the use of the contingent stop around $311.25, the risk per leg is around $150. The maximum gain would be $650 per leg if at expiration in one week AAPL was trading below $300/share. In the first hour of trading, AAPL sold off below $306 per share. If an option trader had more than one contract on, he/she could take partial profits and place a stop at the entry price insuring a winning trade and allowing room for the trade to run.

Obviously the trader may want to adjust his/her stop based on market conditions, but this is simply an example of what can be accomplished with options. Once the trader understands how to determine the risk that an option trade assumes, he/she can build trade constructions to fit nearly any trading style or strategy. For a contrarian trader, options offer an unbelievable opportunity to mitigate risk and maximize profits. Learning how to trade options does take time and effort, but the potential returns options offer when they are used appropriately are unparalleled.

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MarketWatch engages in Federal Reserve propaganda

This is pretty sad considering who owns the website:

Then there is this:

Gold has become highly prized bling, as anxious and astute buyers alike, from hedge-fund players to central bankers, flock to the “currency of fear.” Gold at around $1,400 an ounce is almost double what it commanded two years ago, and gold’s price is up almost 25% so far this year alone.

It’s been a great ride. Except gold is a bad investment.

Gold’s feverish run has made a lot of people a lot of money, and though the rally has taken a breather in the last few days, there’s no shortage of flag-waving supporters who claim gold is on a march to $1,600, $1,800, $2,000 and beyond. After all, gold is still well below its 1980 peak, when it was worth around $2,300 an ounce in today’s dollars.

….and this:

“Mercury poisoning,” is the answer from Barry Ritholtz, the very outspoken CEO and director of equity research at Fusion IQ, when asked where Zoellick’s idea might have come from.

Zoellick, also a former Treasury official in the Reagan administration and managing director at Goldman Sachs, made his suggestion in an op-ed in the Financial Times last Sunday, just days ahead of the Group of 20 major countries meeting in Seoul.

The suggestion was made to world leaders in order to address “global imbalances,” the diplomatic expression being used to refer to the impact of China’s vastly undervalued renminbi on other countries’ competitiveness.

All of the above is pure garbage. Gold is a hedge against inflation and the dollar. Do not listen to the Statists who want to seize all of the gold and give you a worthless dollar.

By the way, here is some SOUND investment advice pertaining to Gold:

There have been some major trend changes recently and it looks as though more investments are about to follow. The real question though is… Are You Ready To Take Advantage Of It?

It has been an exciting ride to say the least with the equities and metals bull market and the plummeting dollar. But it looks as though their time is up, or at least for a few weeks. Traders and investors will slowly pull money off the table to lock in gains or cut losses and re-evaluate the overall market condition before stepping back up to the plate and taking another swing.

Below are a few charts showing some possible money making trade ideas in the weeks ahead.

TBT 20+ Treasury Note Inverse Fund

This fund moves inverse to the price of the 20yr T.N’s also known as bonds. Looking at the chart you can see the recent reversal which took place. We had a great entry point shortly after this reversal took place using my low risk setup strategy.

Falling bond prices are considered to have a negative impact on equities because it implies that interest rates may start rising which means more investors will pull money out of stocks and put that money into a safe interest earning investment. You will typically see bonds change direction before equities. That being said the chart below is an inverse fund, so when this bond fund goes up, it means actually indicates bond yields are falling. I will admit these inverse funds really throw my brain for a loop at time… I prefer the good old days, buying long and selling short… so simple and clean… —- Read the rest Here

I ask you, go read the rest of that; listen to people, like the man at this link, who want to see you make and keep your money. Not force you to trust in an unsound money system, like the United States Dollar.  If you are not interested in FTS’s and would to buy actual Gold, then try this link here.

In fact, here is a video that explain why you should own Gold and Silver:

Is it not just good common sense to have a backup plan? Do not delay, invest in Gold and Silver today.

Please Note: In the interest of full disclosure — There are links in this blog posted that if click on and product bought or signed up for, will result in the compensation of myself. This will come with no price increase to the customer at all.  Think of it, as an easy way to support this blog and yours truly.


Stock, Oil and Gold trading advice: How long and how high for Gold, and how to play it

Regular readers of my articles on Gold over the past few years know that I have a theory on this Gold Bull market. In summary, it’s that we are in a 13 Fibonacci year uptrend that started in 2001, and now we are in the final 4 years of that uptrend. It is in this last 5 year window that I theorized started in August of 2009 that investors really get involved. As the crowd comes in, prices push higher and higher, and then more and more investors come in and so forth.

The very recent rally has pushed us up to about $1,420 per ounce, on the way to my projected $1480-$1520 pivot highs on this leg from the $1040 area in February of this year. Subscribers to my TMTF newsletter have learned about Elliott Wave Theory and how to properly apply it to benefit from both the ups and the downs in various parts of the markets, as well as commodities and precious metals. If I am correct, we are in the 3rd wave up of 5 total waves from the August 2009 $900 per ounce levels. The first leg went from $900 to $1225, the second leg was corrective to $1,040, and now this 3rd wave should complete at around 150% of the 1st wave’s amplitude. In English, the probabilities are for Gold to continue higher to about $1527 per ounce, possibly a tad higher if the typical Elliott Wave patterns take hold, and also assuming again that I am correct in my read of those patterns.

One of the better ways to play this next 4 years of upside with intervening corrections is to look at prospect generator companies. These are Gold, Silver, and Copper explorers that do the early field work in identifying prospects for drilling. They then farm out these projects to willing partners and retain equity stakes and /or percentiles of the project itself. This reduces their need for capital while retaining nice upside for shareholders, and diversifying. When you are a tad long in this current wave pattern’s tooth, this is way to stay onboard, but not go overboard. I have personal ownership positions in a few of these types of companies, and my subscribers are aware of the few that we really prefer. Should one of the projects not pan out, you are not placing your entire shareholder bet on one drill project, and yet if they hit on a few, the upside can be substantial.  – Read the Rest

Video: Rick Santelli on what the Tea Party means to him

Via OUR LIVES, OUR FORTUNES & OUR SACRED HONOR:

Oil, Gold and Stock Advice: The Market Continues The FOMC March Upward and Crowd Patterns

With the election over and congress divided, it may be difficult for the president to get much done. None of this will take affect until the near year but traders are asking the big question… Will the government work together as a team or will it be a stalemate?

Today’s whipsaw action after the FOMC statement shook things up as it always does. We saw gold, silver, the dollar, SP500 and bond prices go haywire. It took about 30 minutes for the market to digest this news in that time a lot of people lost money because of the wide price swings. Trading around news, I find, is a net losing trade over the long run and I advise never to do it. Rather wait for a trend to form and trade any low risk setups that come your way.

I truly believe that the market has already priced in most news and events which unfold, and that news tends to agree with the overall trend of the market. Of course there will be short term blips on the charts from the news, but they tend to be minor setbacks in the underlying market trend. That being said, the trend is our friend, and while so many are trying to pick a top in the equities market it makes me cringe because they are fighting the trend and the Fed.

Read The Rest Here

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In my recent forecast updates for my subscribers and also in my free articles online, I have expounded on the virtues of Elliott Wave Theory, which I use as my linchpin for my short and long term views. To wit, back in August 2009 I made it clear that we would enter a five year period of a massive move up in both Gold and Gold Stocks. Gold was $900 an ounce at the time, and is now at $1360 an ounce. I made that forecast based on human behavioral patterns that go back centuries. Crowds love to all act like a swarm of bees flying together. Everyone hates stocks or sectors when they are down, and the crowd loves them when they are up or going up. Investors like to chase stocks and sectors when they are up high and running near parabolic, but they don’t like to buy large dips or consolidations ahead of moves. Once you learn that Elliott Wave patterns and a few other indicators sprinkled in can give you a heads up on when the crowd is about to jump in, you can basically front run the crowds.

I digress and go back to the Gold Bull Market. The reason I knew in August of 2009 that from $900 Gold we would enter a five year “massive” Bull Run is due to crowd patterns. To refresh, I see Gold as being in a Fibonacci 13 year cycle up that started in 2001. The first five years not too many investors participate in the Bull Run because the prior 20 did nothing. By the time everyone realized in 2006 that Gold mutual funds had compounded 30% a year for five years, it was too late to jump in. Of course, that is when everyone started buying Gold mutual funds and stocks. The problem is the first move was over, and we had 3 Fibonacci years of chop with no net gains. The crowd gives up around the summer of 2009, and that is when I forecasted a huge five year move to come. So far Gold is up over 50% in 13 months and Gold Stocks are up well north of that. The junior stocks started expanding in volume and price months ago, and that should have been yet another wake up call to investors.

Read the Rest Here

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Stock and Oil Trading Advice: Gold, Oil, SPX Trading Around the Election

This week we have a major wild card (Election) happening on Tuesday. Most of you know I don’t get involved with political discussion for several reasons… one of them being that I am Canadian “an outsider” looking in.

That being said, it looks and feels as though the market has been propped up and oil has been held down from an invisible force. Lots of theories going around saying higher stock and lower/stable oil prices will give voters the warm fuzzies to keep the current leaders elected… I prefer trading the charts and not getting caught in the Wall St. hype.

Read the Rest

 

Video: Gold and Silver Manipulation Exposed by GATA

An interesting video:

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Gold and Stock Advice: Gold Stocks, SP500 & the Dollar – What’s Next?

Some good stuff to read here:

Investors around the globe are concerned with the economic outlook, not only with the United States but with virtually every country. This has caused not only investors but banks and countries to start buying gold & silver in order to be protected incase of a currency melt down in the coming years.

While the majority is concerned about the eroding economy, we have seen the opposite in the financial market. Gold and equities have risen… That being said the volume in the market remains light simply because the average investor is no longer putting money into the market for long term growth. Instead individuals are now focusing on saving and paying down debt.

That being said we all know light volume market conditions allow Wall Street powerhouses to bid the market up. Not to mention with quantitative easing taking place I’m sure that has also helped the market of late. While we don’t know for sure that QE is taking place as we speak, the sharp drop in the dollar and strong move up in gold are pricing this into the market.

via Gold Stocks, SP500 & the Dollar – What’s Next?

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News: Mid-Week Market Report on SP500, Oil, Gold & Dollar

Some interesting news:

Wednesday the market didn’t tell us anything new. The equities market is still over extended on the daily chart but the market is refusing to break down. Each time there has been seen selling in the market over the past two weeks, the market recovers. Equities and the dollar have been trading with an inverse relationship and it seems to drop every in value each selling pressure enters the market, which naturally lifts stocks.

That being said, sellers are starting to come into the market at these elevated levels and it’s just a matter of time before we see a healthy pullback/correction. The past 10 session volatility has been creeping up as equities try to sell off. There will be a point when a falling dollar is not bullish for stocks but until then it looks like printing of money will continue devaluing of the dollar to help lift the stock market. Some type of pullback is needed if this trend is to continue and the markets can only be held up for so long.

Below is a chart of the USO oil fund and the SPY index fund. Crude has a tendency to provide an early warning sign for the strength of the economy. As you can see from the April top, oil started to decline well before the equities market did. This indicated a slow down was coming.

The recent equities rally which started in late August has been strong. But take a look at the price of oil. It has traded very flat during that time indicating the economy has not really picked up, nor does it indicate any growth in the coming months. This rally just may be coming to an end shortly.

Read the restHere.

Stock and Gold Advice: Gold forms Overbought Rising Wedge at Resistance

Please note, this is a sponsored posting…

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(via The Gold and Oil Guy)

Sunday Sept 12
Precious metals soar as investors flock to gold and silver. But are they looking deep enough to truly understand the current trends at hand?

When reviewing the metals sector I like to look at it from different angles to get a solid understanding of the patterns and trend forming. I follow multiple time frames along with monitoring the gold mining stocks. Gold stocks tend to lead the price of gold bullion and when its out performing the price of gold substantially by 10% or more you should be expecting a pause or pullback in both gold stocks and gold bullion prices temporarily.

Below are a few charts showing the long and short term trends for gold.

Gold Bullion Price – Weekly Trend Chart

Gold continues to be in a strong up trend. The occasional test of support at the major moving averages can provide great long term points for adding to a position. The 50 period average is one which is tested frequently.

Looking at the weekly chart does give me a red flag for the intermediate price of gold. While the trend is clearly up I can’t help but notice the rising wedge which is a bearish pattern. During an uptrend we want to see bull flags and pennants, not a grind higher forming a narrowing range. This grind higher could unfold much similar to the price action of 2005 and 2007 instead of a correction but I am leaning more towards a sharp correction because more people are bullish on gold now then they were during the June top.

For those looking at gold as a long term investment/currency can be patient and wait for a pullback to a major moving average before adding to your position then you would lower your overall risk for this position. You will understand after reviewing the following charts.

GLD – Gold Bullion ETF – Daily Chart

(This fund moves identical to spot gold price so even though I am showing you GLD fund, the spot gold chart is doing the exact same thing.) As you can see below the price of gold is trading at resistance and becoming choppy. Buying gold at resistance does not make much sense to me. There is a very good chance gold will move lower in the coming weeks providing a better price for long term investors to add to their positions. For example, if you waited for the weekly chart to pullback to the 50 period moving average that would be like buying this GLD fund at $113, which is an 8% discount.

Gold continues to hold up within its channel but this week we could see fireworks if the price breaks below the blue support channels.

Gold:Gold Stocks Comparison – Daily Chart

This chart shows the performance of gold vs gold stocks from the Feb 2010 lows. The blue line is the performance of gold stocks while the red line shows gold’s performance. It’s obvious that when everyone is bullish on gold they buy the highly leverages gold investments in order to take full advantage of the upcoming move. This is much like reading the put/call ratio for trading the SP500 and it measures the bullishness of the precious metals sector.

When gold equities are strongly out performing gold bullion you should be thinking about raising your stops, taking partial profits and or hedging your long term position until the sector stabilizes is not trading at a premium.

Precious Metals Sector Trading Conclusion:

In short, Gold is in a strong up trend and will remain in one for a long time. Commodities have higher percentage of going parabolic. That means there’s a small chance that gold continues to move up quicker and quicker surging hundreds of dollars in a very short period of time. That being said, it’s not very likely, and from a technical point of view those buying gold now are paying a premium in my opinion.

Being a patient trader is not easy, but waiting for low risk entry points is very rewarding on many different levels when done correctly.

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For questions or to get great stock, oil or gold advice like this, please head on over to the gold and oil guy’s website.

Stock and Precious Metals Advice: Precious Metals Equity Index Form a Triple Top, What’s Next?

Please note: This is a sponsored posting.

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Via Chris Vermeulen AKA The Gold and Oil Guy:

Wed Sept 8th, 2010
I am going to step out on a limb in this report and cover what I think to be an intermediate top in the precious metals sector. Everyone I speak with and from the hundreds of emails I get I would say the vast majority are bullish on gold and silver. That being said, I feel we are 3-8 days away from a pop and drop in the price of gold.

Below are my explanation and charts of what I think is unfolding.

HUI – Gold Bugs Index

This chart tracks a basket of gold companies and can be used as a leading indicator for gold bullion at times. This index tends to lead the price of gold before rallies and also during declines. I have seen this lead by a few hours and even up to 7 days. I find it out perform when gold is about to rally, and under perform when gold is topping or about to start another move down.

It looks as though we are forming a triple top which also happens to be at a previous 2009 resistance level. Each time this level has been reached sellers take control and send the market sharply lower. There have been several long upper wicks formed in the past few sessions telling me that buyers are pushing the price up, but sellers hit the sell button pulling the market right back down. If this triple tops plays out, I would expect a multi month correction to take place.

UUP – US Dollar ETF

The US Dollar looks to have found support at the March/April lows and has put in a very solid rally. If the chart pattern is correct then it looks as though the dollar will breakout to the upside and run to $24.75 area. The relationship between the dollar and the precious metals sector is generally inverse, meaning if the dollar rallies both gold and stocks should fall.

GLD – Gold Bullion ETF

The chart of gold has identical patterns no matter if it’s this ETF or spot gold price. So this analysis goes for both ETF and gold bullion prices. Anyways, the past two times gold rallied for this length of time without any sizable pauses we saw the price of gold drop $70 per ounce, and $140 per ounce which is equivalent to $7-$10 drop on this GLD fund which is a decent size move.

The chart is screaming of a nasty correction to occur any day now. With gold testing the June highs I feel its only days away. What I am looking for is a pierce of the June high. That will suck in the rest of the bulls as they jump on the band, and cause all the shorts to cover their positions. This causes a pop, and once buying starts to dry up, the big money will start to sell down the price to trigger the stops and start a multi day waterfall sell off.

With the declining volume as the price grinds its way higher it tells me fewer individuals want to buy in at these high prices. Once the price starts to slide it will cause the stops to triggered. And because there have not been any substantial pullbacks along the way, there is a larger number of stops sitting in the market waiting to get hit.

Mid-Week Precious Metals Trading Report:

In short, I feel precious metals are on the verge of a sharp correction which may only last a few days, but the drop will be substantial. I still think we could see a few more up days or sideways session before this happens as the June high for gold bullion should be penetrated before the market truly reverses back down.

Anyone long gold, silver or PM stocks should be thinking of tightening their stops and for the gold bugs to mentally prepare them selves for a correction.

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This is one of those times, when you could not pay me to work in the White House

That’s right folks, the President and his Administration are in one hell of a huge bind. If they do not do something fast; they are going to be sunk come the midterms and possibly come 2012.

Here’s your video:

Visit msnbc.com for breaking news, world news, and news about the economy

Now, for the Stories….

Via the New York Times:

American businesses added more jobs in the last three months than originally estimated, but the wheels of the economic recovery are still spinning in place.

The private sector added 67,000 jobs in August, according to the Department of Labor, higher than consensus forecasts, and the government upwardly revised its numbers for June and July, suggesting that job creation was slightly stronger over the summer than originally reported.

But the continuing wind-down of the 2010 Census, as well as state and local government layoffs, led to an overall loss of 54,000 jobs in August.

With businesses adding about half the number of positions needed simply to accommodate population growth — much less dent the ranks of the jobless — the unemployment rate ticked up to 9.6 percent, from 9.5 percent.

“The overall picture is one where the labor market is still kind of treading water,” said Joshua Shapiro, chief United States economist at MFR Inc. “It’s better than sinking, but it’s certainly not surging ahead.”

Given the continuing addition of private jobs — albeit at a tepid pace — Friday’s monthly snapshot of the labor market seemed to calm fears of a double-dip recession. But the numbers are likely to do little to assuage political pressure on the Obama administration in the run-up to the midterm elections.

Speaking from the White House Rose Garden on Friday morning, Mr. Obama called the latest job report “positive news,” but said he would be unveiling “a broader package of ideas next week,” to shore up the flagging economy, although he declined to give specifics. The president once again urged Congress to pass a stalled bill that would offer tax breaks to small businesses and create a $30 billion program to encourage community banks to lend.

“There’s no quick fix for this recession,” he said. “The hard truth is that it took years to create our current economic problems, and it will take more time than any of us would like to repair the damage.”

Responding to the higher-than-expected private sector numbers and revisions, investors pushed up the major stock gauges. By early afternoon, the Standard & Poor’s 500-stock index was up 1 percent. Market reaction to the jobs data was tempered somewhat by a report that said growth in the services sector had slowed in August.

The Labor Department revised its private sector number for July, raising the number of jobs added to 107,000 from the 71,000 originally reported. And private sector hiring in June, originally reported at 83,000 and lowered to 31,000, was raised again to 61,000.

This is not making Democrats happy at all… Jack Tapper Reports:

Flanked by members of his economic team – including outgoing Council of Economic Advisers Dr. Christina Romer, whose replacement has yet to be named – President Obama chose to look at the silver lining in the economic clouds of today’s jobs report – not even mentioning that August saw a net job loss of 54,000 jobs.

“In the month I took office, we were losing 750,000 jobs a month,” the president said. “This morning, new figures show the economy produced 67,000 private sector jobs in August, the eighth consecutive month of private job growth. Additionally, the numbers for July were revised upward to 107,000. Now that’s positive news, and it reflects the steps we’ve already taken to break the back of this recession.”

The net job loss for August is largely because of the layoffs of 114,000 Census temporary workers.

….and from David Corn:

Democrats are spooked by recent polls and predictions indicating the GOP may slam the Dems so badly that the D’s lose the House and possibly the Senate. The Republicans need to gain 39 seats to seize the House, and it’s not difficult these days to find nonpartisan handicappers who predict the R’s could gain 40 to 50 seats. The conventional wisdom in D.C.: A tsunami is heading toward the Democrats. A Democratic strategist toiling on the party’s House efforts refers to working on the “Titanic” (though he claims there may be some hidden life rafts). “The president keeps saying it’s a tough environment,” says a Democratic House staffer. “We know that. We want to know what he’s going to do about it.”…

“He still wants to be seen as post-partisan and bipartisan,” says a House Democratic leadership aide. “But we’re in a fight here.” Democrats expect Obama to come out swinging nonstop — bashing the R’s repeatedly and proposing economic initiatives that actually register with voters. At the same time, members of the House Democratic leadership are worried that Obama will cave and yield to GOP demands that George W. Bush’s expiring tax cuts for the wealthy be extended. “If he doesn’t do something immediately, our members will be livid,” says a House Democratic aide. “And when there’s fear of a bloodbath, it’s never too early to start the blame game.”

I just blogged about how the Democrats can fix this mess. However, knowing them like they do; they would rather let the Nation suffer and blame the Republicans for the entire mess, while living large on the taxpayers dime —- than to actually do something to fix the problem. FDR did this, to a certain extent as have many other Democrat Party Presidents; I mean, it is not like Obama is going to be affected by any of this economic downturn.

One there is very certain, the tide is turning, Democrats had the chance to actually fix things and they have failed at it miserably. The Tea Party has now crystallized into a political force to be reckoned with — even among Republicans. RINO’s are being flushed out and true-blue Conservatives are being brought to the battle. It is so bad that the liberal media is gone to terrible spinning facts, an example:

It is possible that coming at the end of the summer an uptick in people looking for work is not as positive as it appears. This is the time of year, after two hot months, when recent graduates start to actually think about their future and send out resumes. And you can image many other out of work people deciding to take off looking for a job in the summer. In August, with the summer ending, some of those people started looking again in earnest. But you would expect the big uptick in post-summer people searching for work to come in September. So the fact that it is coming early is a good sign.

Oh Yes, it is that bad on that that side of the political aisle. When you start reading that sort of idiotic spin in a liberal publication, you know that things are horrifically bad right now for the Democrats. This midterm election and possibly in the general election; will most likely go down as the worst ever failure of the Democrat Party ever. The Democratic Party roared into power in 2006 to take the keys away from the Bush Administration, then they won the General election in 2008. They then got the entire key chain of the Country —- and proceeded to drive the Country as a whole over a cliff!  Because of that and because of this economic that we are in, which was, in fact, created by the Carter and Clinton Administrations; whom were, Democratic Party Administrations — we are about to see a major collapse of a party’s authority in the political realm. I have written here, time and time again; that the Democratic Party has horribly overreached…..again. This happens just about every time the Democrats get into power. To be fair and as non-partisan as I can be; Republicans have done it too — Nixon did it, Bush did it and some others. However, this administration took it to another more frightening level.  Because of this; they are about to do what many call, “Paying the Piper.”

The ship is sinking and the rats are jumping. It should be very interesting to watch. 2010 looms and they have no answers.

Welcome to the meltdown. Get popcorn. Hold on tight and enjoy the show.

(H/T to HotAir on the story leads for this posting. Good show AP! :D )