Data point triangulation leads to probability deduction.

As the formula persists, so do the profits.

Though shorting into the trend is never easy, at some point the crowd is to be faded.

RIMM - Oil on canvas 25.Sept.09

In Tokyo, the Nikkei 225 Index closed lower by 2.64% at 10,265.98. Nomura (8604.TSE) traded limit down at ¥573 after the company announced an equity raise of up to ¥511 billion, or $5.6 billion. The offering is estimated to be 30% dilutive to existing shareholders.

Nikkei 225 - TSE

8604 Nomura Holdings

The following changes to Research In Motion coverage have hit the wires this morning:

Raymond James Cuts to Market Perform from Outperform, price target: $85.

Deutsche Bank Cuts to Sell from Hold.

BofA/Merrill Lynch maintains Buy rating, price target $100. Believes sluggish guidance could drive stock back down to its recent lows of $65-$70, but would accumulate on weakness.

Goldman Sachs (GS) Cuts to Neutral from Buy, price target: $73.

The S&P cars roared out of the gate and climbed a few points on euphoria from the better than expected employment claims headline: 530,000 versus 550,000 expected. 30 minutes after the open, existing home sales hit the wire and were light of expectations: 5.1 million Vs. 5.35 million expected or -2.7% month over month. After selling off, the market traded in a range for the remainder of the session, closing lower by 10.09 or just under 1%.

S&P 500 - September 24, 2009

Oil and gold mirrored weakness in equities as the dollar was well bid. Inversely, the Euro was weak.

US Dollar - 15 Minute

Volatility is beginning to pick up and closed higher by 6.22% at 24.95.

VIX - Daily

Credit spreads were wider across the board. US bonds were well bid. The 7 year $29 billion auction drew 3.005%, bid to cover ratio: 2.79 Vs. 2.63 prior. Indirect bidders took 61.2%. Even Rick Santelli — who grades on the curve — gave the auction an A.

After hours, Research In Motion (RIMM) traded lower on lighter than expected top line revenues and weak year over year margins: 44.1% Vs. 50.7% a year ago.

I have been cautious and positioned for risk aversion — strong dollar, weak equities and commodities. The market is pulling back and distribution is increasing. I will continue to watch how players react to the distribution. Whether this pullback will develop into something more meaningful is yet to be seen. For the short term, the path of least resistance is lower.

And the beat goes on.

One of my volume indicators shows distribution in Research In Motion (RIMM) yesterday and today.

RIMM - Daily Chart