This market is desperate.  Desperate for a glimmer of hope, a light at the end of the tunnel, politicians with brains.  Whoops!  Did I just say that last part out loud?

So, New Home Sales went up today all of 0.01 – told in millions, that’s 10,000 homes.  The teeniest of moves up.  Barely a drop in a very tired, sad, empty bucket.  But the way the markets reacted, you would have thought we had a return to, IDK, 2001!  LOL!  Okay, I love volatile news announcements, so I’ll take it, but it’s just plain weird.

New Home Sales; 7-26-2010

5 points on the initial move, 1.25 on the correction, 3 points on the similar move.  Okey-dokey, we’ll take it!!

By Joseph Plocek

WASHINGTON (MNI) – The U.S. June employment report was weak and the bright spot of a 0.2 point dip in the unemployment rate is likely to be ignored.

The June employment report had few surprises, and shows slow growth. Payrolls printed -125,000 and included -225,000 census workers and +83,000 private jobs. May-April jobs were revised +25,000 in total.

The unemployment rate fell 0.2 point to 9.5% as the labor force contracted by a huge 652,000 workers on seasonal adjustment. The unadjusted labor force advanced 901,000, and the only age group whose participation increased was age 55+.

Hours and wages (all Average Hourly Earnings fell 2 cents for +1.7% over the year) were modest, suggesting slow gains ahead in income and production.

June payrolls were mixed: manufacturing +9,000, construction -22,000, retail -6,600, transportation +14,600, financial -15,000, leisure +37,000, temp help +20,500, health +16,800.

Overall, this was not a robust report whose surprise drop in the unemployment rate reflects more discouraged workers and caution entering the workforce.

Details: Payrolls/Prior AHE,yoy Agg Hrs Civ Unempl Rt/Unrnd Jun -125k —- +1.7% 99.1 9.5% (9.5115%) May +433k +431k —– 99.0r 9.7% (9.6980%) Apr +313k +290k —– 99.0r 9.9% (9.8633%)

** Market News International Washington Bureau: (202) 371-2121 **

Asks, wicks, ticks, candlesticks…what?  When I first enrolled in Market Mover Trading, I didn’t know selling short from a fill price!  Brackets were for shelves and domes were something cakes did when you baked them, right?  RIGHT?

Pre Market Mover Trading, pictures like this made my head absolutely SPIN:

Chart Confusion? Not with MMT!

Now, that picture (my chart from earlier today) isn’t confusing at all to me!  And I am not spending hours and hours every day studying.  This knowledge comes with a couple of hours a week and just being around trading.  Mucho learning by osmosis!

I am here to tell you that you shouldn’t let lack of knowledge about these kinds of  terms  or “scary” pictures of charts be what keeps you from an education with Market Mover Trading.  Other issues might keep you from it, but it shouldn’t be either of those!

It is so empowering to watch Fast Money on CNN and know what they are talking about!

Take a look at the MMT Education Video or pop in for a Thursday night webinar and see what all the buzz is about…

Join us for some Free wine tasting and gourmet hors d’ oeuvres as you enjoy a relaxed atmosphere of Networking, Discounted Shopping & Fun!

May 12, 2010 from 4-7 p.m. @ 3740 Dacoro Lane in Castle Rock!

This event is for EVERYONE!  It’s a way to relax and enjoy some freebies while checking out local small businesses in a beautiful, available commercial property.  All attendees with get a goodie bag and a free oil change!

Awesome Prize Drawings:

• Nancy Student ~ WildTree Basket
• Kris Jordan with Garvin’s Sewer Service
• Nina Anderson with Wine Shop at Home
• Ryan Tracy ~ Meineke Car Care ~ Free Oil Change for Attendees
• Renee Louis with Arbonne ~ Basket of Goodies
• Mark Tasker ~ Camp Bow Wow ~ 2 Day Get-a-Way Spa

DJ and Music by our Robert Romano with ACES DJ
Food Provided by the Following:

• Tommy’s Bodacious BBQ :: Tom Ren 303-968-7099
• WildTree ::Nancy Student 303-717-3123

We expected to see some extra volatility coming into today’s trade after yesterday’s shenanigans.  But news that was mixed left the S&P having a whipsaw reaction.  Patient traders who made it through the first couple of minutes on the trade were rewarded.

Dawn-Renée's Non-Farm Payroll Trade 05-07-10

Leading up the the announcement, you can see the S&P move up (yellow arrow moving up on the left side of the graphic) in anticipation of the move.  I don’t normally put orders in prior to the announcement, but the movement up made me expect that we would be likely to see immediate movement downward on the announcement.  So I sold short at 1131.25, expecting the market to move downward.  Instead, it started wicking (the skinny green section of the candle) up.  I drug my stop loss farther up once, expecting that it would go back down because even though the market added 90,000 more jobs than expected, most of those were temporary government census jobs and unemployment actually went up .2%!  I tried to drag my stop loss up a second time, but didn’t make it and it filled me at 1134, causing me to lose 3 points.  However, true to my Market Mover Trading education, I didn’t panic and instead focused on the news.  Sure enough, there was a correction downward as the market realized that the Non Farm Payroll news wasn’t actually good news!  I made 4 trades on the downward movement (see yellow arrow down in the middle of the graphic) using MMT’s proprietary Prediction Points for 6.50 points of profit. (S@1132, B@1129.75; S@1129.75, B@1128.75; S@1129.5, B@1127.75; S@1128.25, B@1126.75).  Then, using a MMT strategy, I suspected we would see similar movement (as the initial news), so I bought long and made an additional point.

So, for the day, even with the initial 3 point loss, I was up 4.5 points, which is 45% and $225 on one $500 contract.  I was 7/8 trades for the week and up 70%! Woo-hoo!  If I can learn and succeed at this without much brain damage, anyone can.  I spend WAAYYY more time blogging about this than I ever do actually setting up to trade and trading.

ForexLive:

Stocks plummeted in a flashback to the panicked trading of 2008. Investors fled everything from stocks and risky bonds and poured money into safe assets such as U.S. Treasuries.

Stocks began the day in negative territory but took a sharp dive south in the afternoon as selling built up and some indexes fell through key technical levels, sparking new waves of selling, investors said.

As losses piled up, the Dow Jones Industrial Average plunged more than 900 points. Key short-term credit markets—such as the rate for three-month Libor—began to show signs of stress and corporate bonds tumbled. The Dow was recently down about 485 points to 10380.

A 20% drop in the Dow would have been needed to halt trading. After 2:30 p.m. EDT, the 20% standard goes into effect. Before then, a 10% drop would have triggered at least a 30-minute halt. For the second quarter, 10% equals a 1,050-point drop in the Dow industrials while 20% equates to 2,150 points.

The exchange first implemented the circuit breakers in the wake of the market’s crash in October 1997. In 1998, the New York Stock Exchange set the triggers at 10%, 20% and 30% declines in the Dow for three levels of halts.

The S&P 500 and the Nasdaq Composite, which also saw steep intraday drops, were down more than 4% each in recent activity.

Credit markets, too, are beginning to show signs of stress. Three-month Libor, the benchmark rate for billions of dollars in debt, shot to 0.42 percentage point from 0.37 percentage point, traders said. Corporate bond indexes also tumbled.

“It’s getting pretty ugly out there very fast,” Guy Lebas, chief fixed income strategist at Janney Montgomery Scott. “There are definitely some major concerns that are escalating this afternoon.”

Investors remained deeply worried Thursday about the unfolding drama of Europe’s efforts to prop up Greece’s finances. Despite boisterous street protests, Greece’s parliament passed a bill with austerity measures that will give the country access to an assistance package jointly offered by the European Union and International Monetary Fund. Other EU members will take votes in their respective parliaments soon to approve spending on the package, with a first test expected in Germany on Friday.

“A lot of traders are getting carried out of their seats. There are lots of liquidations including hedge funds out of riskier assets,” Michael Franzese, head of Treasury trading at Wunderlich Securities in New York. “No one was expecting this sell off in stocks and the euro and a flight to quality trade is in full effect and it’s not yields levels it’s just capital preservation.”

While the bailout is expected to pass in Germany and elsewhere, it remains unpopular among voters who don’t want to see their respective countries’ resources used to solve Greece’s problems. Traders said that any hints of populist backlash could slow the package’s implementation or lead to omission of elements needed to prevent global economic contagion.

“Some of the panic-mode has come in now,” said Jay Suskind, senior vice president at Duncan-Williams. “What you’re seeing in Greece—even the pictures on the television with the protests starts to spark some real fear.”

With about an hour of trading to go, New York Stock Exchange composite volume has already topped 8 billion, making this the second-busiest day of the year in the market. The 2010 high was 8.4 billion shares, set on April 16 when the government filed fraud charges against Goldman Sachs.

Traders described Thursday’s trading as driven largely by automated sell orders, which piled up after several technical barriers were breached, in particular the 1150 level on the S&P.

“A lot of people thought we had support around that level, so there was some disappointment that it didn’t hold,” said Phil Roth, chief technical analyst at Miller Tabak.

But he added: “The numbers themselves are a little less important than the manner in which the market gets there. The important thing is that we’ve had a very non-traditional bull market, without any major correction or several years of advances alternating with sideways periods. This could be the thing that sets off a real correction, but we’ll have to wait and see.”

—Donna Kardos Yesalavich and Kristina Peterson contributed to this article.

Write to Peter A. McKay at peter.mckay@wsj.com

Riding The Tax Credit Roller Coaster…

Pending home sales surprised to the upside for a second straight month in March. Follow through for April existing home sales (up 6.8% in Mar) should be expected. Pending sales (contract signings) lead existing sales (closings) by a month or two.

The homebuyers’ tax credit has generated big swings in pending sales: +40% from Jan 2009 to Oct 2009; -20% from Oct 2009 to Jan 2010 (after original expiration); +14% from Jan 2010 to Mar 2010 (ahead of current expiration).

Apr 30 Deadline

Buyers need a contract in place by Apr 30 to qualify for the tax credit. Further upside for pending sales is likely next month.

So, much of the information on this site may appear to most people as gobbledygook if they aren’t traders.  Since non-traders are our main readership, we thought it would be helpful to occasionally explain what the heck we are talkin’ about.  Uh, ya think?  LOL!  So, anyway, here is the low-down on selling short and buying long.  It’s pretty simple, actually.

Y’all already know what ‘buying long’ is.  It’s the regular old way to make a profit.  Buy low, sell high.  You buy something at as low a price as you can, and then you sell it for more.  It’s called “marking up”.  Retailers do it all the time.  You hopefully do it when you buy and sell a house.  Pretty simple.

Selling short is just as simple, but since most of us don’t sell short on a regular basis, it’s more unfamiliar to us.  Say your next door neighbor has been working long, tough hours.  She really needs a new car, but she doesn’t have the time or energy to shop for one herself.  She tells you what she wants…a 2008 Toyota Prius.  She wants to pay no more than $16,500 for the car.  You say, sure, neighbor.  You can buy that car from me for $16,500!  Then you find the exact one she wants that someone, terrified of the Prius recalls, is willing to sell for $13,500.  You buy that car for $13,500 and sell it to your neighbor for $16,500 and you made the difference for your time.  So, you sold a car that you didn’t own, then bought it for a lower price and profited by the difference.

To understand PMI (Purchasing Managers Index) in this context, you need to understand that the Institute of Supply Management (ISM) Manufacturing Index measures the activity level of purchasing managers in the manufacturing sector by surveying more than 300 manufacturing firms on employment, production, new orders, supplier deliveries, and inventories. A reading above 50 indicates expansion. Traders watch these surveys closely because purchasing managers, by virtue of their jobs, have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.  More specifically, PMI is a rating from 400 purchasing managers who are asked to rate the level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

Dawn-Renée's ISM Manufacturing PMI Trade; 05-03-10

There is a whole slew of related information that comes out with the ISM Manufacturing PMI.  When the PMI came out today, it was slightly lower than expected, which caused an initial drop in the market.  I did not get in right away because volume was low.  Then the volume spiked and things started moving.  At the point volume started increasing, we were close to one of Market Mover Trading’s proprietary Prediction Points.  So I decided to buy long at 1190.25, knowing that we were likely to see a correction.  The market continued to go down.  However, the rest of the ISM Manufacturing data had come out and it was all positive, more orders, higher prices and lower inventories was GOOD news!  I

Jody's ISM Manufacturing PMI Trade 05-03-10

knew the market should start to go back up as traders digested the rest of the ISM news.  We were coming up on the next Prediction Point, so I decided to put another buy long order in at 1189.50, in case it got that low.  It did, and then started going back up.  I put my sell order for both contracts at another Prediction Point, 1191.50, but I got nervous and decided to pull down the sell orders to 1191.25.  A bird in the hand…told you I was conservative! Anyway, I still made 2.5 points total on my money (1 contract @ $500), which is a 25% return or $125.  Took me all of 10 minutes to setup and 7 minutes in the trade; and 7 minutes is a long trade for MMT!

To the above right, you can see Jody’s trade.  He waited for the initial movement downward to stall out, then he bought three contracts long at a Prediction Point (1089.50).  Then, his profit target, which was set at 1.5 points above his buy point,  sold him out automatically at 1091 for 1.50 points, or a 15% return on his investment – $225!  Jody said if he would have been thinking about it, he would have pulled his profit target up to the next highest prediction point at 1191.50.  But profit is profit!  What a great trading day!