Forget the Federal Reserve trying to raise rates as fears of a DB failure sends stocks lower. DB has a very large derivative exposure and like we saw in 2008 it does not take much to push risk over an edge. Systematic failure was something Central Banks across the globe were looking to wipe out. Unfortunately, it does not appear as if they were successful with DB. At this time the bank is still afloat, but where there is smoke there is fire. We have a few new hedges for subscribers tonight and we’ll be watching over our stop levels. Caution is certainly recommended here given the price action we are seeing from our holdings and the overall market.

The fear of the unknown is prevailing as no one knows if DB will go under and if they do what will happen. We certainly have no idea and do not own a crystal ball. We only worry about what is in our control. What we are in control of is our position sizes, entries, and maybe most important exits. If we are to see a new downtrend so be it. We do need some sort of correction. The start to this year was a correction, but it was shallow. Sure, we had a great rebound and gains were solid. We would love to see a good old fashion correction setting up a big year end run. Whatever this market has in store for us we’ll go right along with it and profit.

AAII Bulls finished the week at 24% while Bears ended the week at 37%. Same old story here and given the action over the last few days we’d expect to see the number of Bulls continue to drop. AAII survey continues to show a lack of bulls and it is a shame as they have missed out on some solid gains.

One day left in the month of September. Enjoy the start of October and we’ll see you back here next week.