Short term Bullish

I am wearing a bull suit at the moment but it is only a short term rental.  Not going to wear it beyond a few days.  By next Tuesday, I will remove the bull suit and consider putting on a bear suit.  I don't think the down move is over.  Yesterday was the crescendo of part 1 of the selloff.  Today is the remnants of that selling pressure and we should get a reasonable bounce soon.

I want to emphasize that I think it is still too early to put on long term positions here unless you are willing to sit through another selling wave next week.  But the trading odds slowly favor the bulls as the selloff continues and more bears join the sell side.  Remember, we are still in the heart of corporate buyback blackout period, which has the been the main source of equity buying power for the market for several years now.  Plus, ahead of earnings season, I doubt that you will see a big bounce that sticks.  The crowd seems to be scared to death of AAPL earnings coming up later this month.

The put call ratios are finally getting spiky and that is sign of a short term selling climax.  I don't want to mention China because it is a bunch of nonsense and fundamentally, the Chinese stock market is meaningless and the yuan devaluation hurts Asia much more than it hurts the US.  It isn't even that meaningful to Europe, although China does affect Germany more than the US.

Not bullish on oil here, even though I am bullish ES for a bounce.  Oil is deadly on the long side.  Stay away.