I got a call from a family friend anxious about his 401k a few minutes ago. There was panic on the other end of that call from an upstate suburb. When will the market bottom? How long will it take for me to make back what I lost? What the hell is going on down there? This is not an uncommon conversation lately.

I have to admit I hate making money in markets like this. I know my job is to make money. And trading has been incredibly profitable for our firm and me lately. And this will not end soon. As traders we can forget just how much pain many are feeling. And I hate that part about trading. I wish this bloodshed in the market ended and ended tomorrow.

As a trader it is my job to start thinking about what might put in a bottom. And I have not seen anything that indicates a bottom yet. I have not seen capitulation. I have not heard of large funds having to liquidate. There is no clarity on the swaps that the big banks own and need to unravel. On “Sixty Minutes” it was mentioned that we cannot estimate within 10 trillion dollars how much bad debt just might be ought there. If you are a huge fund how can you put a ton of money to work before such clarity? The price action continues to be miserable for stocks. GS, the strongest financial, closed near 100. 115 had been strong support for many weeks. If the financials are to lead our rebound we are not seeing that yet in the strongest financial, GS.

I don’t know where the bottom will be. I am not trained to make those calls. As a trader I don’t see it yet. But as a trader I must start making a list of potential catalysts to put in a bottom. You as a trader should make a list as well. This will help you manage your positions better during this trading period. And if one of your catalysts appear then start to look for some buying.

I will be watching GS carefully tomorrow. There was some nice money to be made trading GS into the Close. And the 100 support level was not violated. Good luck with your trading.