Friday, December 25, 2009



I am thinking 1130-1134 max on Monday followed by a decline to 1113-1120 by Wednesday.

I have been thinking about this for the past two days and this is on the capital gain taxes and CAN WE SEE SOME SELLING BETWEEN DEC 29th-31st 2009???-

Assuming the institutions started buying in Jan-Feb 2009, those who bought in Jan will start to hit the sell buttons in Feb and those who bought in Feb might do so in March. Now, the question is are they going to wait until a year is over to avoid higher capital gain taxes or will they start selling the beginning of next year (2010) as opposed to this current year so that they do not have worry about paying taxes before April 2010 versus April 2011. The focus here is when will will the sell orders come in?--a year after stock purchase or beginning of 2010? I know we would think a year after stock purchase to avoid higher capital gain taxes but what if some institutions start to sell at the beginning of next year because they do not want to wait until Feb-Mar when the market could be down 5-10% due to selling by institutions who have waited a little more than a year. What I am trying to say is all the selling might not happen in Feb-Mar, we might see some selling by people who are ready to take profits in the beginning of 2010 and ready to pay taxes by Apr 2011 as opposed to Apr 2010 because they do not want to wait until Feb-Mar where they might be selling at a 10% lower levels if a correction happens.

Now, if people are ready to sell at the beginning of 2010, can they still sell between Dec 29th - Dec 31st of 2009? Assuming it takes 3 business days for the transaction, will selling between Dec 29th-Dec 31st appear as selling in Jan 2010? If so, some people will sell between Dec 29th-31st 2009 and still not pay taxes until Apr 2011. This is possible because they will be selling at the highs as opposed to selling at a 10% lower level (assuming we have a correction) in Feb-Mar 2010 and not worry about paying capital gain taxes until Apr 2011. They will save 10% by selling at the end of Dec-early Jan but may pay 10-15% more in capital gain taxes compared to the institutions who will be selling in Feb-Mar 2010 at 10% lower levels but pay 10-15% less in capital gain taxes. In summary, it may not make much of a difference between selling end of Dec-early Jan and selling in Feb-Mar 2010 (assuming we have a 10% correction).

I am just speculating here. Correct me if I am wrong and appreciate others insight.


X and SNDK are doing a parabolic move similar to Gold. You know how these parabolic moves end? Just see how GLD dropped from 120 to 105 within a few weeks

X- Maybe a tiny bit more upside and then it corrects to 50-51. Weekly RSI still has some room to the upside

SNDK- Has huge resistance at 32.50, which is also the 200 MA on weekly.

III. OPTION ARM's: Suggest a market crash in July-Oct 2010 and July-Oct 2011???

"It’s tough to say exactly when the storm will come. But my guess is the second half of 2010.

This second wave of foreclosures will not be good news for the economy or the stock market…At least that’s my guess."

Merry X-mas and a Happy & Prosperous New Year to all.

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