Monday, November 7, 2011
Hard to Game
Headline risk coming from Italy has thrown a wrench into the market patterns. Instead of getting the gap up, we got a gap down but only a minor one from much bigger weakness earlier in the overnight session. I would look to position short because the Italian 10 year yields has reached terminal velocity. We'll probably have a moment of panic during US hours, not just European hours sometime soon. Early strength followed by afternoon weakness today.
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6 comments:
What level do you have in mind to short?
The train might have left the station without me. Was waiting for ES 1260
Thanks for reply. I thought you're waiting for 1270 area ad you mentioned on Friday.
I will look to short sometime on Tuesday. I don't want to wait too long, this market looks like its consolidating before we make a move lower. Rallies often last either 5 weeks or go on for 8-9 weeks. If we don't fall within a week, then I would be worried that I was wrong if short.
MO, what's your reasoning that it's not consolidating to go higher?
Europe is trading too weak and we've got so much resistance overhead, plus there is no longer that bearish sentiment that would provide a wall of worry.
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