FRI. SEP. 19- Temporary Bottom In Place

URGENT URGENT URGENT-
SHORT SELLING BANNED BY FDERAL GOVERNMENT ON 799 FINANCIAL STOCKS. PRESS RELEASES BELOW:

Bloomberg: "Short Sellers Under Fire in the U.S. & U.K. after fall of AIG


LIST OF STOCKS:

SEC RULES: "New Shorting Rules"

So, did we hit a bottom yesterday? The definition of a “V” bottom according to most technical analysts is a reversal of a sheer panic sell-off on record volume. Guess what happened yesterday? The Dow, after trading ahead of 200 points, fell to down 130, and then closed just off of its high, up 410 on record NYSE volume exceeding 10 billion shares. Why did this happen? Because of several measures-rumored or otherwise- one after the other. First, the Fed ‘encouraged’ a number of foreign central banks to inject their systems with dollars. This is why the markets opened higher. Coercion. Second, the British government randomly decided to ban the practice of short selling in the financial stocks. Communist-like move. Then, yesterday afternoon, there were rumors that Fed Chairman Paulson will now become the largest hedge fund manager in the free world with the government purchasing substantially all the bad debts on the books of the banks, thus making the American taxpayer loaded to the hilt with mortgage bonds among other illiquid securities. What this grand plan would do is free up the banking system by allowing banks to freely make loans and got monies flowing anew. What is not clear is whether the Feds would just own the bonds (or at what price they pay or how they dispose of the assets) or if they annex equity in banking and brokerage stocks as well. Basically, understand that the government basically becomes very long American housing. Time will tell. For day traders, we must pay extraordinarily close attention to this plan and be very studious of the news as well as cognizant of the fact that we will not be able to short many stocks which of course forces more artifical upside pressure to prices. We need to thoroughly understand because if everything comes to fruition re the plan, it will become the topic de jour for weeks to come if not longer.


Reiterating-If the whole story is not there -
If something is good, assume either a short thru unchanged or an A-B-A2 based on direction of the market unless specifiedIf something is bad, assume either a buy thru unchanged or an A-B-A2 based on direction of the market unless specified

Today’s list is highly unusual and more of a list than specifics. Yesterday afternoon produced one of the wildest closes in the history of trading. At the bell, there were massive imbalances in many stocks as discussed on the chatroom at that time. Many of those stocks had gigantic moves on the close. Thus, there are two ways to play this- focusing mainly on the stocks that had buy imbalances and closed on their highs. First, if the market opens higher this morning and these stocks open higher, they will inevitably be the first to decline in any market correction because they’ve artificially risen so much already. For instance, BIDU rallied almost 30 points on the close yesterday to close at 305. So, if it opened higher this morning and approaches unchanged to the downside, short it because of the spike at the close. If it opened below 305 and approached that number in a rallying market, buy it thru 305 as it shows strength. The ‘good’ below are the buy imbalances to focus upon and the ‘bad’ were the sell imbalances.

Good-

Imbalances-
BIDU
CTRP
EK
DISCK
URI
CNB
NCT
NLY
MBI
CNO
MTG
CIT
HNI
HST
TRV
COF
RF
FNB
SHLD
TPX
LTM
VLY
CSE
MEG
PRU
AFL
UA
MET
EQR
CME
KIM
ALL
BZP
PRK
MGM
MI
END
NFP
ESS
HCP
BPOP
MBHI
CYN
SFI
ATLO
VNO
SOV
NFS
HIG
CB
XL
FRT
ORI
BAS
SINA

Other:
ORCL- great earnings

Banks such as C, WB, WFC, USB, BAC- should be strong with plan rumors
Brokers such as GS, MER, MS should be strong with plan rumors


Bad-

Imbalances-
JNS
DISAD
PBR

Other-
WM- deal may not go through
PALM- bad earnings


Earnings-
None today





Good luck today.
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