I went long the double short ETF's mid-afternoon yesterday, kind of jumping the gun. One of my unspoken rules is to wait till the end of the day on trending days (like yesterday clearly was from the beginning) to trade.... The best times I find for mid-term trend changes are early and late in the trading day. That's when most mid-term peaks and bottoms happen...
So, expecting the market to either form a range or resume defining the downtrend, either way not expecting a rally to new 2009 highs. If that does happen, I'd expect it to be a fake-out and to fail quickly, though again not expecting it.
Just to be clear, I prefer to trade for 1+ month outlooks, not this quick fire stuff that I've been doing. But I don't dictate the timing of opportunities and take them as Mr. Market gives them. Paradoxically, the recent trends have been well worth trading even while the VIX is hitting new lows from since the LEH fiasco.
So, as I might've mentioned a month or so ago, I feel the market is done with the big move off the bottom, and will resume a downtrend. My recent bullish trade was a opportunity to profit from a short term reversion in what will be a bear leg and expecting ~810 to be in the cards this quarter or so.
3 comments:
I wonder if anyone has realized how similar this year's S&P and oil chart patterns are to last year, right down to this week's rally and the oil double tops:
Last yesr's S&P rally in July:
Low of 1200 on 15-Jul-08
High of 1291 on 23-Jul-08
Feels like the top was just put in, doesn't it?
That last comment was made on 7/22/09 - I don't think the date is listed.
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