Battle of Helms Deep

Plenty to discuss so let's just do it.

Market Operations
During the day today I made two buys. The first was YMI based on some candle work I did last night. I should have seen it as "Why am I" buying stocks today! This one actually held up ok and did not violate the candle that I had decided to buy on.

The second was another candle and PPT scoring find, OCZ. Quite a bit of "other" stuff going on with this stock including a conference call tonight. Will keep an eye on it. No reason to get way long right now.

Battle of Helms Deep

Today after the market close I was driving home from Cambridge and a huge rain storm with dark clouds blew in. Reminded me of that scene in "The Lord of the Rings" before The Battle of Helms Deep when the rain starts falling.

By now you must know that markets took a dive today and it was not pretty. Significant damage to long running trendlines was done. Major moving averages were breached. Chart for S&P 500 for a look:

So where are things?

I wish I knew. I will offer up my own ideas and then do some linking to better observers than me to round it out. Here is what I think:
-Volume was not the massive dump off that usually comes from a panic bottom. This could mean things are not as bad as they look, or a bigger washout is at hand.
-Time was efforts in Washington usually were a good thing. The FED is really on the spot at the end of August.
-I love technical analysis and use it for near term trading. One of my only reservations about TA is it reflects everything that the market knows right now. Unfortunately the market tends to ignore stuff for a long time and then discover it. Chaos ensues.
-Along that line slowing economic data has been ignored as price action has been good. Price action is not good now.

In general I think it will be smart to watch the next few days. Obviously getting involved is risky. I would rather miss the next 5-7% move up in the indices and wait for a real trend to emerge that try to stick a bottom call here and get washed out. Many will try though.

Linkage
The best stuff I saw today.

The Fly tells it like it is, in his unique style:

"If this market trades down tomorrow, that will make 9 straight days down. This is a KARL DENNINGER, ZEROHEDGE, DOUBLE BLUE BLAZER, APOCALYPTIC dive lower, no safety net. If you are a bear, this is your chance to kill everyone and eat their brains. You must pray for state failures and civil wars, famine and pestilence. Throw in a little epidemic, and I believe this market can go lower."

Barry Ritholtz and Josh Brown have been getting lighter on holdings as of late. Thanks for the tip.

Downtowntrader has advice I find to be spot on:

"Even if the markets do bounce in the next few days, the odds for a flush out first are probably better than your odds at a Casino. While it appears the worst is behind us in this debt deal nonsense, the markets showed very little strength today and futures are flat tonight. Until they show some semblance of strength, its best to keep your exposure to a minimum."

Three notes from me via Twitter today:
-With all the news of spanish and italian wide spreads one would think economics was actually sexy.
-I find it better to observe bottoms instead of picking them, even if itchy to do it.
-Today confirmed the feared over the shoulder double boulder holder pattern and you KNOW what that means....

Stay sharp folks.

Is Nothing Sacred from the Robot Revolution?
While we are concerned about debt defaults and imploding markets, I cannot allow the robot revolution to go unnoticed. To temp children and girls alike, a fire breathing pony robot is a threat to us all (via Geekologie):

Oh my.

Added:
MUST See video, this cat saw today's close:
Thriller Dance Kitteh

Have a good night.