Monday, October 10, 2011
In an Uptrend
The market turned from a downtrend to an uptrend last Tuesday. Traders are still adjusting to this new uptrend, and that is why you get these monster gap ups on nothing. Most are positioned for weakness and when it doesn't come, they cover and squeeze the market higher. I will look to short around 1185 to 1190. But now I believe the safer side to play is the long side, since we are now in a uptrend. The short I want to take will just be for a quick pullback, where I plan on covering, and reversing to long.
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13 comments:
here we go, back to the highs.
got to hand it to the bulls. poor shorts.
It is too crowded on the short side, and the price action is too strong even with all the bears. Let the bears feel some pain first and then go to the short side. Maybe end of Tuesday or beginning of Wednesday.
what, even with the huge move that we have already had? Nothing has been resolved, this bounce is huge already. I thought you were bearish on this market but all of a sudden we have bottomed and now returning to the highs wtf??
Yes, we are returning to the highs. Nothing has changed, but the price action. Fundamentals only matter in the long term, in the short term, it is ruled by trader positioning, sentiment, and technicals.
Not much upside to play with, we probably get up to 1276 in the extreme but we will peak out again around 1230 and go to new lows in the early part of next year and then can judge if it really is time to get long... the problem is the falls in Europe and parts of Asia didn't allow for all the weak hands to be shaken out, after those sharp declines you usually need one more panic. Also dollar move looks more corrective in a new bull run. Buy XIV if you want to go long as you will make money in the long term on a short short term VIX futures product as you pick up the decline in vol and the contagio as we move out of backwardation in VIX.
so we might get a little pull back and then long. What level might pullback going to before we head to the moon?
Who knows, but the pullback should not last more than 3 days. So buy on day 3 of a pullback and ride to the moon as usual.
selling off at the close ..just like Friday.
Sell into these rallies.
pull back bought as usual in this rally. probably go higher before any pullback.
markets will fall on high short interest when markets talk about it alot which is in a few months. hardly anyone mentioned biggest short interest since 2006 until after we squeezed. we head higher in october still. next time we have a high bearish sentiment read at new 52 week lows on s&p will be a spiral down
XIV inverse vix etf tells me we are in a bear market as VXX kept getting hammered in thte past bull market. XIV losing over time thru bear attrition even thru these big squeezes it will be zero once all this is said and done. Probably reverse split 1:8 next month.
I think we'll drift up on low volume over the next three days pending bad news out of the EU.
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