U.S. Court of Appeals 7th Circuit Puts Brokerage Accounts At Risk

August 17th, 2012

On Thursday, August 9th, 7th Circuit Appeals Court ruled on the lawsuit between Sentinel Management Group, Inc. and its customers. The ruling, awarded in favor of Sentinel, now puts brokerage accounts in the US at risk. Read the rest of this entry »

Are High Frequency Trading Robots Just Full Of Air?

August 12th, 2012

An “Air Pocket” stock is by definition, any security that experiences a sudden drop in share price, much as an airplane experiences turbulence causing it to drop unexpectedly. Generally, air pockets come as a result of negative corporate fundamentals, such as a quarterly earnings misses, FDA announcements, or SEC investigations. But now, high frequency trading robots are creating air pockets for so many of the Market’s equities, turning investing into a “Buyer Beware Market.” Read the rest of this entry »

Computer Decision Making Costs Knight Capital Group $440 Million

August 5th, 2012

This last Thursday Knight Capital Group, Inc. disclosed that due to a computer “glitch”, a technology “snafu”, the company lost $440 million. Their shares sank 63% and closed at $2.58. And it took just 45 minutes. $440 million was almost twice what the revenue for the second quarter. The immediate question is, how can a computer glitch nearly ruin a company? Don’t they believe in stop losses? Read the rest of this entry »

Price Action or Sentiment — What’s Driving the Dow and the S&P?

July 29th, 2012

Monday and Tuesday of this last week, the Dow started down 200 points. This came on the heels of last Friday, where the Market was also down over 100 points. Then something changed. Suddenly the Market put back on 400 points. What changed? Was it price action or sentiment that changed the Market’s direction? Read the rest of this entry »

CFTC — PFGBest — Well — It’s About Time!

July 15th, 2012

On Friday, 13th of July, the Commodity Futures Trading Commission (CFTC) finally approved financial rules submitted by the National Futures Association (NFA) to ensure customer funds held by Futures Commission Merchants (FCMs). What finally pushed the CFTC to file new protections? FCM firm, Peregrine Financial Group Inc. (PFGBest) declared bankruptcy after losing $215 million of customers segregated funds. Once again, the CFTC failed to protect futures traders. Read the rest of this entry »

What Will This Week’s Earnings Season Bring?

July 8th, 2012

At the beginning of this last week, the Market was flying again. Perhaps because Wednesday was the 4th of July. Perhaps because they knew that on Friday the unemployment numbers were not going to be wonderful and would like cause the Market to come back down. Taking no chances, institutional traders ran the S&P 500 ran back up to 1374. And by Thursday, the Dow had regained 12,955, looking as if it were going to break back above 13,000. Could the Market recover all it had lost in May? But Friday came and took the wind out of the Dow’s sails, dropping the Dow back down to 12,778. Read the rest of this entry »

Treasury’s International Capital Data Report Reveals All — Just Learn To Read It

June 16th, 2012

Last Friday the Treasury Department released its April International Capital Data Report (TIC). Too bad this report is two months in the rears. If only this report came out monthly as so many others do. Because this report shows where the insiders are taking the Market. Read the rest of this entry »

Bernanke’s Testimony, Was It Just A Setup?

June 10th, 2012

On Thursday Fed Chief Ben Bernanke delivered his testimony to Congress. Everyone sat on pins and needles waiting for what he would say. The pundits on CNBC were chanting QE, QE, QE. And then it happened…”No change in policy unless conditions deteriorate further.” The wait was over. “Great Expectations” unmet. No “QE”. To the Market, a great disappointment as it fell quickly. But hold on. Let’s go back a couple of days and look at the activities right before his testimony. Could this have been just a setup? Read the rest of this entry »

Technical Indicators…Are They All They Are Cracked Up To Be?

May 26th, 2012

Ever wake up one day and say, “I want to become a “technical analyst” daytrader, someone who sits in front of the computer all day buying and selling shares of stock or options/futures contracts? Being a novice to trading, you bring up a technical chart, add a couple of indicators such as moving averages or MACD and say to yourself, “this is going to be easy,” as you count the money you’re going to walk away with, your dreams of wealth finally coming true. But within a few days, all your dreams come to an end, as you see your portfolio drained from loss after loss after loss. Read the rest of this entry »

Facebook IPO — The Party That Never Happened

May 20th, 2012

Ever been invited to a big-time party, a party with lots of hype, a party you run out to buy a new outfit for so you can be dressed to the nines, a party where you just need to be “seen”? And after you spend all this money to “be seen,” what happens…no one bothers to even come. Welcome to the Facebook IPO. All the media hoopla about how great the Facebook IPO would be. All the CNBC pundits telling us that this was going to be the hottest IPO ever, the greatest day for trading since sliced bread. In the end, the underwriters actually had to buy up the shares just to keep the stock from falling below its open price of $38. Read the rest of this entry »