I'd like to let everyone know that you can make plays that make you money when the market goes down. Don't fight the tape when things are going down you set yourself up to take advantage of that. So the sky is falling and you may be thinking to yourself where o where shall the market at least stop for a little while and bounce back for a relief rally because I forgot to short a month or so ago when Mr. Pumper told you that the up was going to stop in the big picture? Well look at the chart below and you can see that at present the SPY is right where it was in June, and right just above the 200WMA. The way I see it there are about 3 scenarios in the coming week or 2. All of these are a less than a month away type of thing so to take advantage, I would buy Calls that are out beyond the election, and take a look at the wide range so as one window is slipping away, you would need to sell that off for a small loss, and look for the next level of entry, and the next level would get a little more investment capital until either one of these scenarios hits, or you go broke and blame this Slurry Pumper for leading you down the wrong path. One of these is going to be a big winner in about a week or so's time so I'll be back to update you on how it goes.
- The market bounces tomorrow on "Turn around Tuesday" having put in a indecisive doji style candle that is right about at the correct time for this type of a thing to happen. Tomorrow may start with a flush down to the 200WMA, and at that point I will take a small nibble while still hanging onto what I have left from the Puts I got last month until I see a close above the 376 spot. Why 376? 376 is the low for the monthly candle from a few months ago and represents a level on the monthly basis that may signal there is just a test going on of this level. A rally would then develop and we would rise from the ashes to make another higher low.
- The Head and Shoulders play will play out and we will find the SPY down below 340 to maybe 320 if things get going bad enough. At this point the sky would be falling and I would be looking for a capitulation week to see if that would be it for now. If it were to happen we would get a relief rally off of this spot that may last another few months.
- There is another spot at 350 which has a gap from 2 years ago when the SPY ran up to 350 got rejected a few times then did a gap over and took off to never come back until now. They may choose to fill the gap and then turn around. It would be typical market behavior. Make everyone think the SPY is giving up the 200 WMA and making a charge to the head and shoulders playout, spike through watch all the short players jump on board and then after filling the gap at 350, have a short squeeze play that would rip it back up for a while and give all the people selling in the hole a shyt sandwich to eat.
I'm in camp #3 but as always stand ready to play all scenarios to differing levels of investments.
So today's pumping term that may sound a little dirty is:
SUCTION HEAD - Its actually a little short hand for Net Positive Suction Head (NPSH). Its the measure of available fluid for the pump to intake. So when some of yous say my old lady can suck start a Harley, what your really saying is that there is enough NPSH to turn over the bike to start it.
A typical statement would be, How much Suction Head does the impeller require to ensure that there is no cavitation in the pump?