Just 5-days ago the Dow was at a six month low of 11,985. That nice fat round number at 12,000 held and then we had a 767 point rally, capped off by this morning’s high tick at 12,752.
We have a buy the rumor/sell the fact trade. Spain’s banks get 100MM plus in buyout protection, and then the market’s break. Market’s exist to punish people for their “obvious” trades. Spain’s banks getting bailed out should be positive, but the markets are future’s markets, not yesterday’s or today’s markets.
12,600 was taken out, and we had 150 point bounce above that. Depending on where your stops were, you are either still short, or you got stopped out for a small loss.
I was stopped out of 2/3 of my position, but luckily, my last stop, set up at 12,802, was never triggered.
I am adding to shorts below 12,500.. I have a down side target of 12,373 and then 12,286.
I think if we might have seen the trading range established for the next 8 weeks, unfortunately. In 6 weeks most of Europe goes on vacation. That typically slows down trading, which pics up again w/ a vengeance in September, and then every Bear’s favorite month, October… Heading into an election in November could spark volatility, but in my opinion, we’ll see stagnation as people dig in their heels and wait and see.
The grains continue to rally. Its a weather market. We will have pull backs, but in front of the USDA tomorrow, I think you use them to get long or stay long.
Always have an out point established in advance, however.
You can’t take your opinions to the grocery store and buy food. Only your money counts.
Tuesday, tomorrow, we have a USDA. Speculate accordingly.
That is all for now.
CER