Both paths lead to lower prices and the 1 trade I might regret

"First the sheep are right, then they become PermaBulls, then they get slaughttteeerrreeedddd!" That should be Jim Cramer's slogan instead of "Bulls make money, Bears make money, and Pigs get slaughttteeerreddd!" I'm not interested in just making money, I'm interested in making it, keeping it, and making more of it. Not just making it when the rest of the sheeple are easily making it too. Remember in 2005 - 2007 during the housing bubble? Everyone was making money. All you had to do was be a sheep, then become a perma bull, then you would be broke today. But we are talking housing, and making money in a rising market in housing is much different from making money in a rising market in stocks. You can be profitable at any given time in a stock position, but the question is when you are up, when do you take profits, and when do you get back in? Some would argue that its best to buy a position and never sell it and look out at least 3 years. And maybe they are right, but that would be the equivalent of buying a house, renting it out, paying the mortgage and collecting the remaining  equity after expenses as your return on investment. That would be worth waiting 3 years for I guess.

But here we are talking the stock market and in this profession of trading, some industry phonies who do nothing more than pretend to educate you and spew out content regardless of its value have secretly turned the stock market into a game of drawing charts and indicators. Everyone is guilty of it, and when you think about it, it's really quite odd. All the brokerage houses give you programs that allow you to see bids and offers, provide you with the most up to date charting with 1000's of indicators, and made buying and selling so cheap that they want you to think that prices move based on some voo doo indicator. And everyone is guilty of at-least theorizing. New or novice, everyone is getting suckered into taking shorter and shorter trades and use more and more indicators to guide his strategy and  spot these points of entry and exits. It's absolutely ridiculously and everyone should just stop right now. These widely followed indicators like the 50 day EMA and 200 day EMA have over a hundred years of history behind them so their self fulfilling prophecy is almost ingrained in the minds of wall streeters. No matter how advanced the game gets, fund managers and retail investors alike, will obsess over these tracing paper indicators to help guide their entries and exits. One such trader who has unsuccessfully been navigating these markets for the past 10 years with essentially a 0% to negative return on his Charitable trust portfolio is a man by the name of Jim Cramer.

Just please look at his tweet yesterday as he explains that the reason he wants to buy stocks is because we are "real oversold." Ok Cramer, keep talking to your puppy trained "technical strategist" Stephanie Link as she stares at here 50 day ema and tells you that she thinks this is a good time to buy. Why? because of some moving line on a chart!? LOLOLOLOL! ok lets match up the tweet and the chart.

Now that the self fulfillers are out and about trying to get involved in this rally because they probably missed the huge run up over the past 6 months, I believe we have a two type scenario that could occur in the S&P 500 but regardless of both scenarios, both lead to lower prices without a breach of market highs.

Scenario 1 would be if the $SPY 50 EMA worked and these permabulls will be right for 1 week or so then we will turn back lower. It's why I started this article "First they are right"

Scenario 2 would be a bearish Engulfing candle that would swallow todays candle from open to close onto the downside. This would spark a further sell off in the following weeks. Either way the sell off is in these cards, it's just a matter of when.

IN THE END IS A TARGET OF $155 on the $SPY at the least.

THE $SODA Stream trade - My 1 REGRET

There is 1 trade that I am afraid that has already began to run considerably past my purchase price of marginal safety. I contemplated buying this stock at $60 but geeezzz does this all make sense now. So Pepsi co. was rumored to have been in talks to buy $SODA stream.Of course, why wouldn't Coca Cola or Pepsi be either in talks or be developing their own line of make it yourself sodas. I can imagine the international demand could get crazy as I know personally that when people use the machine they don't turn back  to buying bottles from the supermarket anymore. This industry is here to stay and its the same mistake that these large tobacco companies are making by not making electric cigarettes.  I have a target of $98 for this stock but I may try to enter this stock on an overall correction if the market resolves into my scenario 2 situation. Then I believe $SODA could try to tread lower and actually hold up and base which could give us a second point of entry back in the $60's.

I can make you 50% inside weeks and months, and sometimes even days. 70, 100% , even 200% are regulars for me. So losing 10 - 15% on a position 2-3 out of 10 times is perfectly fine with me. I go for HOME RUNS and GRAND SLAMS. I'm not interested in your stupid buy and hold for 3 years strategy to make 25% or your 1 day hyped up bullshit pump and dump that your daytrading. This is stupid, people need to look back at their charts and understand the bigger picture of every trade. Stop being stuck in time frames and trying to create all these different confluent indicator strategies. It's really all about keeping it simple and money management. I'm not even kidding! It's do you want to make money or not. Some people really do want to lose their money, subconsciously. I know this for a fact and don't take that lightly. When you want to make money you will.

I want you to know that  I have an advantage over most that occupy this profession. When Jesse Livermore said that if a doctor studies close to 10 years before getting his license, that a trader should expect no less, I know that this man knew more than stock markets. He understood psychology, history, time, numbers, and most importantly he was awake to his surroundings and learned from his mistakes. Every element to a person determines his fate. If you miss one then that is your handicap.

Let me leave you off with some stock picks that are going higher tomorrow. Remember that whenever I put out charts, it means I think they are a buy unless I state a price point or say that I am watching this one.

Zale Corporation $ZLC

I would say that I like the company for one reason or another but I wold be lying.  I like $ZLC for two reasons. One its competitor Tiffany's is at near all time highs and the second reason is because Zales's is busting out of 4 and half year pattern which I really like. It reminds me of $PZZI and how it will most likely go up over 50% before coming back down to reality. target is $14 and change.

The ExOne Company  $XONE

It's nice to know this name is in the 3D printing sector as this sector has been hot lately. Names that are hot usually stay hot for sometime as the name cycles in and out of bull and mini bear corrections. It looks like $XONE is setting up for a big price spike higher, as we still own $DDD and believe the 3d sector as a whole could go parabolic in 2013 the way $TSLA and $NFLX did this year.

Doral Financial Corporation  $DRL

Chart says it all except the target price. I would put atleatst a $1.50 target on this at the least. $DRL

James River Coal Co. $JRCC

UPDATE PREMARKET 6/7/2013 - DO NOT PURCHASE $JRCC due the DILUTION OFFERING ANNOUNCED AFTER HOURS LAST NIGHT.

I'm sure many of you remember this old wallstreet darling of the 2008 era when coal names were going through the roof as commodity prices were booming. Well right not we seem to be in a correction phase to the upside from a 4 year depressed bear cycle.  Although I am not promising a $5 target as I'm sure no mutual funds even care to look at the direction of this stocks future unless they can get consistent with they're earnings again. So for now I'll  keep a conservative $4 target.

Orchard Supply Hardware Stores Corporation  $OSH

Although I don't believe $OSH is a purchase right now, I do see that this stock has received some trading interest in it lately. Usually when bars this volatile and volume this large come in, I stand up and take notice. I want to see some action into $4.30 area and $4.50 for a nice breakout that could send this name soaring to $8.

Silver to go up + $5 , Celsion Corp to go up 100% in 1 day and Rambus to surprise

While I still hold the belief that our US markets are headed another 5% lower at the least fulfilling my +10% correction thesis blogged about on May 22nd, there are some names that stand a chance to head higher even as the market treads lower. You see my ladies and gents, the market, although it can act like an elevator at times on the way down, can spend many days in between just hovering up and down giving everyone the illusion that markets are stabilizing and about to head back up. Then right when everyone least expects it, leading names get hammered and everyone finds themselves getting stopped out of their positions.

While I hold my degrees in shorting issues just as comfortably I can go long them, it is important at times like this to be taking the short side of the market on names without hesitation. The alpha is important at times like this or just completely get out and be as nimble as possible on the long side. Once again I will say some names that I am currently short, profiting from and expecting larger gains in the following weeks. $NFLX  $PAMT  $RVLT $AMRI $HIMX are all names I am short. I have a small short in $OWW mainly because I'm paranoid that someone might buy them out and I made enough long it. $UNXL short was fun as I found $15 a great area to cover almost 3/4th of my shares and leave 1/4th for under $10.

Maybe you don't have the buying power or risk tolerance to short so your always looking for something to go long. I've explained many times that buying names in a panicky down market is one of the toughest trades but can be very rewarding as these are the times when the largest of surprise moves occur. Why? Because action junkies and daytraders lose on their stupid overleveraged buy the dip penny scalp daytrades and they need to make back their money before end of the day is over and they wind up jumping into any name as long as there is volume and its up a lottery ticket % move on the day. This same name probably keeps popping up on their stupid overpriced scanners. Then they can't take it anymore and start jumping in and out every 5 min until that final blow off top occurs that send the issue down 20% off its highs on the day but comes back up to close 1 - 3% below its intraday high. Then the next day a blow off top will occur and then the real bag holding will begin as yesterday's daytraders become tomorrows bagholders. Here is my predictive chart on Celsion Corp $CLSN

MY SILVER THOUGHTS

Silver is a pretty low risk trade considering that longs haven't been given a break in this stock for over 9 laborious months. But I am going to caution you right now on the possibility of silver and I want you to understand this strategy exactly! Silver is at a point where it's either going to panic one last time below $20 and become the BUY OF A LIFETIME at around $16 - $18 or this $21 is going to be long cyclical bottom before a 2nd bottom at $21 will be put in again later in the year maybe even around 2014. So in scenario 1 $SLV would stop you out $20 and then becomes the buy of a life time at around $16 and $18 or $SLV rallies $5-$6 from here making your risk to reward trade profits by  2 1/2 times and possibly hit $28. The fact that I expect the market to pullback gives me more conviction in this silver trade. It acts as a hedge and or an undervalued possibility. But notice that I haven't said to buy GOLD yet. That trade I am not quite interested right now because although it could rally with Silver I think Silver is the safe less money tied up trade to go with. I can give you a pictography of what I think the $SLV chart is going to look like but I think I will explain it for your brains imaginative sake. Picture in your mind a little further sideways action then consecutive rising bars at a non stop pace all the way to $25 - $26 all happening within a 2 weeks, to 3 weeks maximum timeframe.

Rambus $RMBS is a name we purchased today @ $8.07 &  $8.10 as TIMESTAMPED on twitter

Rambus $RMBS is in the news a lot and I wouldn't be surprised to find out that its some hedge fund that is manipulating this stock because they want as much of a good fill as possible and they are looking long term with this company. This intraday action is a classic whipsaw , rinse and repeat action to keep daytraders and anyone contemplating a swing position away from buying here. Look how they moved the stock up and down all day in a perfectly timed manner. up in the morning, lunch to mid day walk down, then volume explodes towards the end of the day back over $8.20

I expect a 11.50 target at the very least with $15 being a reasonable possibility.

David Tepper "Extremely Bullish" call on CNBC Exclusive was a little suspicious....

If you haven't seen the video of the two CNBC reporters getting a hard on over David Tepper's market note "Exclusive" (ya right) then please do for a good laugh first.  http://video.cnbc.com/gallery/?video=3000154181

I've seen this world before. The players, the news, the rumors of news. I always think ahead and then sometimes I get glimpses into the future. I don't know if by publicly releasing them, whether it can alter reality but I believe it probably can. But the beauty about now is that I am an undiscovered speculator who only reaches a limited audience at this very moment. But as time passes I make believers out of those who have eyes to witness and ears to listen. I wrote this blog post to point out something that the masses may never realize because they are too busy getting hammered on alcohol and conforming to society and following our hearts just because it says to in a song!!  I don't care what you say, I only care why you say it! You understand me? Well if you don't then let me talk to you about a person and a story.

For many of you that don't know David Tepper, he is a hedge fund manager whose had some stellar returns over the past 5 years. He's  made billions of dollars via the stock market on some bets that solely relied on the written promises of the FEDERAL RESERVE to buy Bank of America, and Citigroup at fixed higher prices in a 2009 note.  (here's an article explaining it, http://www.opalesque.com/files/BloombergRichestHedgeFunds.pdf )  Pretty impressive when read  independently of some further research. Delve deeper into this guys history and it becomes clear that he is a tipping point in his career. David Tepper does not take losses and when he does its being born outright from an all or nothing bet that turns out to be worth ZERO DOLLARS IN THE END. Think about what he does regardless of his success. He bets huge into just about everything he does and keeps a lot of cash on the sidelines in case prices move against him and dollar cost averages until prices rises past his dollar cost average price. This is the exact opposite of responsible investing but in his case he has either dodged landmines, is a super genius, or plays dirty and knows how to get inside information on companies i.e his washington mutual, citigroup, bank of america, and AIG bets that all worked out. ( That is a WOWOWOWOWOW unto itself. How did you dodge, land, catch, throwback, duck, and then rocket ship away with your flawless bets. So you managed to dodge Bear Sterns, Lehman Brothers, IndyMac, Fannie Mae, Freddie Mac, and thousands of other little banks who were shut down. WOWZAAAA you are the most amazing long investor in the WORLD or you know someone who knows someone, if you know what I mean??!!!)

But that was not so in 1998 when the Russian Government surprisingly defaulted on their debt, but Tepper did the unconventional and even though was down 30% just kept buying more on the way down until they recovered and he made 160% from his dollar cost average price. This was the essence of what I think Jesse Livermore or Richard Wyckoff had once said about dollar cost averaging and how you shouldn't do it unless you have the deep pockets of JP Morgan.

David Tepper was shorting the Nasdaq about 30% below its top. If it wasn't for shareholder breathing down his neck some speculate it would have been one of his most successful legendary trades. That can mean only two things to me. That he was balls to the wall short, and given the unfamiliarity of the shorting nature, he could pretend in his mind that he would have stayed short but knowing his track record of stopping out near 20 - 30% frequently he would of very well been scared out that position given the fact that stocks can rise indefinitely.  But all in all between 2004 - 2009 his fund had sat at $5 billion and he made next to nothing for 5 years. So to sum it up logically, that means that during 2006 - 2007's huge bullmarket he made zero dollars. I believe it was because he was looking for deep discounts reminiscent of 2001 and 2003. He couldn't find them so he pretty much got chopped up in the stock market. Then he lost money in 2008 and then went all in the stock market 2009. Now he is playing the stock market pretty aggressively and I believe he is coming to the end of the road where he is about to experience a losing cycle or he has an inhouse oracle who explained this to him already and he is completley bluffing the media on that recent "EXTREMELY BULLISH" call on CNBC the other day which makes me think it was a planted story. He may be ahead of all of you and that story was to get you indecisive suckers in or we could be in the midst of a Tepper moment where he is about to get clobbered.  This is a rough timeline of Appaloosa's moves throughout the life of the fund. (http://www.hedgefundletters.com/category/appaloosa/ )

Who is this Palomino fund inside the Appaloosa fund and how do they make money...   http://www.princehenrygroup.com/PalominoApril2011Deck.pdf   this perfectly tells you that this fund doesn't seem to make it's money from the stock market and does some voodoo mortgage magic to keep having these year over year stellar returns. But who cares, they are not doing it from the stock market so their formula is kept behind 10k's. Ok so CNBC says they are up 6.4% for the year . In their prospectus they say they are agnostic to market swings which must mean they are using fixed FEDERAL RESERVE money that is lent to them at .05% and they loan it out at 4% and greater. Aghhh isn't it great to be one of the money master insider connects that have access to cheap easy money from the Federal Reserve? But don't worry folks, the money they are printing is not your future tax dollars or anything. And don't worry when we collapse from a deflationary spiral, then inflate to the high heavens because every country cuts us off and interest rates rise here through the roof, we will all be ok. Vanilla ice cream cones and rainbow sprinkles will be the theme and those that are perma bull field gazers will feel the butt raping and those that are awake to the truth will sidestep this market and run to the safety of physical gold, guns, and passports. So in a nutshell is DAVID TEPPER a great stock trader or investor?  Ummmm I guess the future will tell when we learn that history repeats itself and those that go all in eventually lose all that is in.! Maybe he is so f*ckn risky and deranged that because he went all in, this guy is seriously on a high that we may all never understand right now, but I will promise you all 1 thing, Appaloosa is about to get a serious negative quarter that could send their year to date of returns well in the negative before 2013 is over. I will give you one video that gave it away to me and made me realize this guy has no idea what the stock market is and he takes the mean reversion trade every time. He is going to get caught bad and he is going to feel a serious drawdown panic. (For those that don't know what a mean reversion trade is, its when a stock rises too much or falls too much and you are betting that it will go back to the average trade price or at-least close to it. http://www.youtube.com/watch?v=Q5yP4cpU32w This guy only makes money in up markets and he admits how 2011 was about to be a horrible year for them if they hadn't pared down positions which is odd given the market ended neutral on the year. I am telling you guys, this guy DAVID TEPPER is a PERMABULL who is about to get crushed if and when 2013 ends on a down note. +++++

There is an anomaly in David's life that he has succeeded through, but longer term trends in his management of money lead me to believe that this same anomaly is about to come again and this time he will be fully exposed. His fund already has the tracks of history behind it. He only does well in up markets and his exposure gets larger. The day of reckoning is coming and we've all heard that the bigger they are, the harder they fall, you will all know what that means. I imagine because of his historical track record of wanting to bet against rises, I imagine that when the commodity boom of 2017 begins he will try to short that. And he will blow up and that will be the end.

Here is an update on some positions and tweets.......

This is what I did in the last week of MAY as this is a review for those who may not be able to watch me as closely on twitter all day and need a summation of my activities. Everything is timestamped for your convenience.

I sold my Blackberry $BBRY position at $14.50's and many are wondering why. Well the reason is simple and its that volume in the stock is indicative that the people in higher places know that this launch and sale of this new stupid phone is a fail. The reason why its so hard for the masses to predict whether this phone is going to be a success or not is because the phone is selling all over the world and its too hard to tell what the numbers are going to come in as when your field of research is the world and every single store that sells the phone. This is when knowing how to read a stock chart with over 15 years experience comes in handy. The worlds pulse is in this chart, its the all knowing , ever knowing! WIZARDRY MY FRIENDS.

On May 23rd after learning that Timothy Sykes most likely is nearing 300 grand in unrealized losses in $LOTE I decided that this stock was going to trigger for a move into $25 with a break of $18.50's and $19's.  We targeted $25 as our immediate target and that was hit in less than 2 trading days!

I'm not shorting $LOTE yet and I think this has a chance to set back up and go towards the $40's as a possibility. If this happens to fall off crash and burn, then I guess I won't be there for the ride. I need to see the volume confirm the down move or in my mind this is a completely manipulated walk down if the price moves lower day by day without any real volume to justify it.

And as we predicted in our last 2 blog posts about how $TSLA was going to be a long through the $96 and hit $115 exactly! Well well, we hit 114.90 so far and we are currently trading at $97 as we took a short at $107 as TIMESTAMPED

but always keep in mind that if volume stays heavy and $TSLA bases that this could come back up to to try and go for the high $120's touch. Always have extra powder incase $TSLA decides to make a surprise move to the high $120's giving that one last gap affect. This stock is in a very critical moment as our $107 short is showing a $10 profit so far and we have the greatest chance of a panic attack huge volume down day sending this down 15 points or more in 1 day! REMEMBER what I SAID!

I promised everyone the other day on twitter a predictive chart of what I think is going to happen to $NFLX going forward as our short at $236 was spot on to the exact day, just like our MARKET CRASH CALL last week to the exact day!

Here is a before chart of $NFLX

and here is after

I also believe our Orbitz Worldwide $OWW  is topping out here and it's best to sell out any remaining long positions and consider a short and as always have extra powder dry for any moves against you. Shorting is not like going long.

I also purchased $DDD 3D Systems Corp. a couple of day ago and believe these 3D stocks are nearing blow off moves like the dry shippers of 2007. $DRYS and $GNK

These are my remaining tweets on MAY 30th when I got short $TSLA

$TSLA conspired with $GS to pay back government loan and allow this run up to happen. http://www.dispatch.com/content/stories/business/2013/05/28/tesla-pays-back-u-s--loan-nine-years-early.html

Can someone please explain how $TSLA is going to have repeat customers who have to fix everything at the dealer?

Tesla car is stupid and no head room in the backseat. Someone please explain to me how Csaba Csere is allowed to be a test driver for Car and Driver. What and who does this guy know because his TESLA review was hilariously bias. Nice try buddy, so how much did ELON pay you? Or do you naturally get excited over men?

The fact that you have to charge your car is proof in of itself that the car is useless. Useless because the people who can afford them don't actually need them hence their use is less. Do you understand the paradox of how stupid the hype is about this company. The Tesla is a driving LAPTOP! Nothing revolutionary has been accomplished here because electricity hasn't progressed. The TESLA driving is stupid because the car has ZERO MOMENTUM! Isn't that paradoxical  since TESLA STOCK had so much MOMENTUM! Stock market is a weird creature and I hope you can understand. Do you understand what I mean when I say the car has No Momentum!? In a regular car if you let your foot off the gas your car will continue to move and decelerate slowly giving your car a better return on MPG. In the TESLA its the exact opposite. This car will slow its self down like a Fisher-Price Power Wheel! Remember those? So what this means is that this car does not get 300 miles to the charge. You will be lucky to get 225 at best and most of the time 200 and below. Just look at your cellphone or laptop and see how your battery is degenerative. So what does this mean? that the car will get 150 miles to the charge after about 5 years at most. This car is sad and appeals to the rich liberal idiots at most. Anyone with a brain knows this car is a crack joke and a toy.

Neuralstem, Inc. $CUR is about to explode as I previously predicted. I have blogged about $CUR previously and been tweeting all week that we are the verge of a huge breakout! $2 price target in the cards at an almost definite. $2.50 - $3 would be where I would love this to go to. remember that I said these stem cell stocks heat up near market tops.

Life Partners Holdings, Inc.  $LPHI

This stock has very light volume so I want you to tread carefully but the setup here is explosive.
$AXDX triggered its buy point from our previous blog post. The stock is up only about .10 or .20 from our initial buy entry and we think this could go to $12 . But to seriously get a break out buy this needs to break $9 and then we could see it soaring. Always keep a stop on the stocks and keep an eye on them. Never put a physical stop loss in. Market makers will fill your order just to screw you.

$HIMX is no longer a buy for me anymore as I will be selling out my full position Monday Morning. I will gladly answer all questions and reasons on why once my new website opens on july 4th. Just expect $HIMX rise to be over and done with for now imo.

And last but not least the infamous Affymax Inc. $AFFY trade then went awry after hours on Friday May 31st.  People want to know what to do with this position and there is a hard truth for most to swallow and that is going to be this. This trade is going to be a loser for now no matter which way you slice it. Even if $AFFY absolutely roars back monday morning I do not expect to close this position out as a winning trade. I am looking forward to taking some losses after the first 15 min of trading, and hopefully close out the position by end of day near 1.70 - 1.80 if I'm lucky. This is why we diversify our trades because every once in a while we can get $IKAN 'ed or now as we know it $AFFY ' ed. In both trades we had the opportunity to sell after hours, but 70% of the time we get some type of bounce back to sell into.  I am looking forward to taking an 8-10% loss instead of 20% . We'll see how Monday pans out!