Thursday, December 18, 2014

Another V?

We are well on our way to another V bottom.  I am surprised that we are seeing such a big gap up after a 2% up day yesterday on "good" Fed news.  Europe seems to have found a bottom, and in a weird change of circumstances, Europe is helping to drag the US higher.  Of course, higher crude oil prices is satiating the commodity bear is bad for stocks crowd, however irrational they are.

In any case, looking at the volume and the VIX this week, it smells like a bottom and feels like a bottom.  It probably is a bottom.  That plus you get positive seasonality for the next two and a half weeks and you have all the ingredients for a move higher from here.  It may seem a bit painful to pay up so much from earlier in the week, but if recent history is a guide, you have to be a buyer.  And hang on.  Buy the dip and ride it, for at least 1 to 2 months.  That is the story of this bull market.

The time to ride it higher is here.  Expecting new S&P highs by January.

7 comments:

Anonymous said...

Sold out of my positions in BAS and SN want to protect the gains. Gave back some from the top but as long as there's a chance that WTI and Brent go lower than the bounce line and make new lows have to respect the short term trend.

Anonymous said...

Fuck this nasty down move in crude could have been a move to shake out longs as well

Market Owl said...

Crude oil downtrend is relentless. I wouldn't touch those energy names. They are death spirals. I may buy WTI if it gets to $50.

Market Owl said...
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Anonymous said...

Close to 50 on WTI and i'll be looking to get long the energy names again. I'll be really surprised if it goes lower than that. They definitely want Brent under 60 dollars it seems. I think brent at 55 and then the real bounce could happen. But first things first they want to take out these dip buyers from Tues and Wednesday.

Market Owl said...

This week doesn't look like a bottom. Crude oil should be much stronger with the S&P bouncing like this. Yeah, Brent at $55, or WTI around $50 seem to be decent opportunity for a quick bounce. But I would only look for a $5 bounce if I bought at $50.

Anonymous said...

JNUG 2 March Calls @ 1.06 and PBR 6 April Calls @ 1.55

Different horses, same race.