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Analyzing the possible outcomes of the Supreme
Court ruling:
Ruling in Favor of Bush (heaven
forbid):
will likely result in a rally (short-lived as it
may be)
1) On C-Span,
Reverend Jesse Jackson warned that massive demonstrations will be held in the
event that the Supreme Court votes against hand-counting the votes in
question. These demonstrations may become extreme (heaven forbid),
giving way to riots. Currently prayer vigils are being held at Federal
Buildings by PUSH and AFLCIO members. News coverage of such unrest
will very likely dissolve any possible rally.
2) The traders that the CNBC empty
suits interviewed said that they planned on shorting the news, no matter
the outcome.
Ruling in Favor of Gore (lessor of the
evils):
3) A ruling in favor of Gore is highly likely to
result in an immediate drop in the indexes; as experienced last Friday when the
Florida Supreme Court ruled in favor of Gore.
Net/net it looks like a high probability
short sell of the Nasdaq bubble. My entry point will be on a break of
intraday support, with the price below both the 18 and 36 period moving
averages, with a stop loss above both averages. This system
provides: 1) a logic entry, trading in the direction of the break-out, 2)
trailing stop, 3) defined stop-loss exit.
Example attached.
To reproduce the chart, go to <A
href="http://www.bigcharts.com/intchart/frames/frames.asp?symb=nasdaq&time=&freq=";>http://www.bigcharts.com/intchart/frames/frames.asp?symb=nasdaq&time=&freq=
View the attached chart to see my
settings.
Happy (and safe) short-selling of this Nasdaq
bubble.
James
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