When Uncle Sam Can't Save the Day...

It looks like the market will cough up all of Friday's gains right out of the gate… October 07, 2013     When Uncle Sam Can't Save the Day…   A shutdown resolution will bring a bounce… or will it? Chances of a 2011 redux Plus: A "Dumb and Dumber" day for Wall Street…   Greg Guenthner coming to you from Baltimore, MD... Greg Guenthner Shutdown, day seven… Stocks continue to swoon. Futures are pointing to a sharply lower open today. It looks like the market will cough up all of Friday's gains right out of the gate… Here's the bigger question: Are we in for a replay of the 2011 market scare that battered stocks? The news cycle has progressed in an eerily similar fashion. Concern builds. Media speculation amplifies investors' worries. Just look at the sentiment data that continues to plunge… "Americans' confidence in the U.S. economy has dropped sharply as the partial government shutdown caused by Congress' inability to pass a spending bill has become reality." Gallup reports. "Gallup's Economic Confidence Index's three-day rolling average stands at -34 for Oct. 1-3, down 14 points from Sept. 27-29, and the lowest such average since December 2011." Despite the dreary feelings, many investors still believe that capitulation by either side in the government shutdown saga will produce a meaningful market bounce. That's my biggest worry right now. We can't assume that the government swooping in to "save the day" will actually help stocks finish out the year on a high note. That's dangerous thinking right now. Approach any market action with a skeptical eye this week. The major averages remain in limbo—close to support and could swing either way. Don't get suckered into complacency. If you're trading, keep your stops tight. This week could be the start of a wild ride…     Rude Numbers Targets, Predictions and Wild Guesses   $10.3 million was the winning bid for a painting called "The Last Supper" by Chinese painter Zeng Fanzhi. The sale set a new record for a Chinese contemporary artist at auction, according to Bloomberg... 65% of stocks trading on U.S. exchanges remain above their respective 50-day moving averages. The indexes are lower, but stocks aren't down for the count just yet… $135 buys a Bitcoin this morning. The alternative currency has rebounded nicely since the Silk Road raid spooked prices lower… $1,318 is where you'll find gold futures this morning. Gold's trying to catch a bid as stocks flounder heading into another week of government shutdown mode… 1,671 marks the spot for S&P futures early this morning. Stocks are set for a nasty open today…     Rude Trends When to Buy... When to Sell   Many investors like to complain about how absurd the markets can be.Well, it doesn't get any dumber than this… "After social media site Twitter announced that it would be listing shares of its stock under the ticker symbol TWTR, some enterprising traders decided to jump the gun and pick up shares," reports Jonas Elmerraji from the trading trenches. "The only problem is that Twitter doesn't even have a date set for its IPO yet. You certainly can't buy shares. Instead, folks were buying TWTRQ, a home improvement chain that went out of business in 2008." The speculation got a little out of hand with TWTRQ. The stock (or whatever is left of it) was up about 700% Friday. Oh, and by the way, the 'Q' at the end of the ticker means that it's bankrupt. Not exactly a great buy for the ole' retirement fund… "Whoever bought is going to be pissed when they figure out what they actually own shares of now..." Jonas adds… [Ed. Note: Don't make dumb investing mistakes. Instead, start trading with Jonas today… Send your feedback here: rude@agorafinancial.com - and follow me on Twitter: @GregGuenthner] [IMPORTANT: I'm going to be stuck on a plane all day tomorrow, so there will be no Rude Tuesday morning. I'm heading to California for an International Federation of Technical Analysts conference. It should be a great chance to stockpile new ideas for you. But don't worry—I'll be back in action Wednesday morning with a brand new trade.]     Ignore At Your Own Peril Today's Must Read Links   Try the Rude Pro for 30 Days, Without Charge The best investment secret on the planet How the West Point Mint "Raid" Could Save Your Retirement!     BE SURE TO ADD dr@dailyreckoning.com to your address book.       Additional Articles & Commentary: Join the conversation! Follow us on social media:         To end The Daily Reckoning's Rude Awakening e-mail subscription and associated external offers sent from The Daily Reckoning and The Rude Awakening, click here. 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