The bids and volatiity are not right...

In our observations: The bids for stocks do not seem natural. The volatility bids do not seem right. If you have been watching the tape, there has not been any churning. The markets are not acting under normal circumstances. There is a significant erosion of strength that is not accurately being reflected in stock quotes and volatility prints. It almost seems as if there are two markets. The public quotes and unseen dark pools off the radar. There has been multiple exchange breaks and bugs at convenient times. Humans do not act this way. It almost seems as if "The Tape" is being painted. Any reversal would cause multiple support breaks as the "painted bids" would evaporate into thin air. The printed volatility is between 14 and 15; however, the observed volatility we estimate to be in the lower single digits. This is an extremely over-crowded trade given the current uncertainty and un-resolved Black Swan events that are present. This is not good. Not good at all. We expect an explosion of volatility that has not been seen since the summer of 2011.

VIX target: 45+

The training wheels are off....

QE is over. Let's see how things do without it.

S&P500 1400 to 2000 in Two Years and The Fed Decision

If your investment condo went from $140,000 to $200,000 in 24 months, would you sell?

Housing top? Market top?

There is not a sole left on Wall Street who does not believe The Fed will be extremely dovish and a fairly decent amount believe they will continue their QE. The markets are all on one side of the trade.

Did the public and media not get the internal memo? It is priced as if everybody on Wall Street knows 100% for sure that this will happen. It certainly is not corporate revenue growth or earnings.

There is 0 volatility. It's all just a formality now.

The is no room left in The Bulls Bar

Talk about crowded trade!

Don't really remember when a trade was as crowded as this one.

A couple thoughts on The Markets

Whether you are long or short, the powerful moves in the markets (all assets) the last few weeks have been impressive. What is most impressive has been the resilience of Wall Street Bulls and The Fed to hold this market up. I have never seen this kind of resilience in the face of so many negative factors in my entire 20 years of trading. There are forces that are very strong that do not want the party to end. The entire system of normalized volatility and standardized market reactions are not functioning normally as predicted by 100+ plus years of expected market reactions and standardized standard deviations. The Algo systems running about 70% of money flows (purely an educated guess) only " see " past patterns and parameters set by historical trading variances imbedded in the systems. This makes for extremely easy "manipulation" of market subsets that domino across all markets. All you need is concentrated money flows into key market subsets to trigger mass program directional changes across different asset classes as asset and market correlations are set in the 98th percentile. Yes, The S&P500can hit 2200 quickly and Yes, The S&P500 can hit 1600 quickly. The potential volatility is not priced in. This is an excellent time to train your skills against the machines. If you do not have the stomach, speed, or ability to withstand losses - do not trade long or short.

We love the challenge! It is crucial for those who aspire to become elite traders to participate in this environment if one is to ever obtain the tools to necessary to continue in the business of speculation. It is very easy to lose money in this environment (Long or Short). Win or lose - this is a wonderful time to test your skills (in moderation) against some of the most determined and skilled competitors in the world. There are 100's of billions of dollars at stake in this Bull/Bear Battle.

Stockspeare 10-27-2014

Only The Pigs , Ostriches, and Sheep left now

You know the old Wall Street words of wisdom. These people left now are probably going to get SLAUGHTERED in our opinion.

Pigs: How much more do you think you are going to get off this pump?
Ostriches: Sticking your head in the sand is not an excuse.
Sheep: Afraid to miss your performance bonus? The next big bounce up? Following the market up even though it doesn't feel right?

Very strange market technical alerts occurring all over the place. There are powerful and concentrated cross-currents. Money-flows are very deliberate and targeted. Liquidity has to be force-fed into the system. Volatility is extremely low for current headlines, news, and the actual facts. Not sustainable.

The Tail Wagging The Dog

Threaten to pull stimulus and "The Street " sends her down just far enough until they get what they want and then send her back up to confirm their approval. This leads to another great opportunity to digest this market dynamic. Whether it is right or wrong is not for discussion here - know your market and profit from it.

To the point:  We see mixed signals from The Fed. We think it is time to really consider going long volatility and shorting the markets again. The Fed and ECB provided this mini "Verbal Bail-Out" the last 4 days. It cost them nothing ( except credibility to some or maybe even a lot -who knows).

The path of least resistance is now DOWN

Our Previous trades are BACK ON. It only took a few days and we originally thought we sold early. We were spot on. We are going to do it again with the profits from the previous trade.

Is it your last time to buy or Sell? We are betting it is time to sell Mortimer. Sell Mortimer, Sell!

Let's watch and see if the profits roll in;) Again!  We need to collect our Christmas bonus now...you can bet "The Street" will be doing the same thing;)

All Long Gold, Market Shorts, and Leveraged Long Volatility Trades Closed Out

Huge profits! Update later.

It just does'nt feel right....

The markets have not followed the normal rules in quite awhile. This is not just our opinion. We have even heard The Gods of Trading ( Goldman Sachs) and other highly respected Pros who have complained that the lack of volatility and following " The Normal Rules of Engagement " are not being followed and it does not allow for the generation of normalized profits thru churning. This is a problem. We believe volatility should be injected into the markets immediately! The longer the delay, the wider the collateral damage. I hope there are at least a couple wise "Master's of The Universe" types who are articulating this concept to The Machine. C'mon Man!