You might think it was pretty nifty how I escaped getting crushed by the AIG pile driver this afternoon(see 11:59 post). Well it was nifty, but my reasons for bailing out mere moments before the red candle of death were based more on human behaviour patterns than technical indicators.
First, I had a substantial profit that it would have been foolish not to bank, second it was Friday afternoon and who wants to hold over the weekend, third every daytrader and his/her dog that got or missed a piece of AIG earlier this week would be trading it dreaming of getting rich, and fourth, those shifty eyed, hawk faced, bald headed market makers who got reamed out by their puppet master bosses for letting the price get run up before they could get their full load, were bound to want to exact some revenge on the unsuspecting.
I kid you not 100% true, all these things went through my mind as I clicked sell. It would have been twice as sweet if my broker had shares so I could have shorted it then. Alas no. As it was I just shook my head when it happened. I imagined the howls of pain from a 1000 traders as those MMs played their dirty trick. All I could do is wait for it to go low enough to take out all the newly set stops and exhaust the downward momentum, throw a market order in and ride the bounce. Stocks bounce like rubber super balls on concrete sometimes. It’s one of the safest and one of my favourite plays.
I know somewhere in my blog writings I mentioned the “unknown forces”. This one of them. File it away in your memory to use again another day.
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