Monday, August 06, 2007


Qs closed just below the 50 DSMA today after another wide range S1/R1 day.
VIX managed to hit another high today before falling back to approach the 10 DSMA. The wide range R1/S1 bar closed on the low the day, which suggests further downside likely tomorrow.
The TICK, NYAD and TRIT were all upslope the last 2 hours, with no range retracement, although the TICK readings were relatively tame. Whether these indicators reflected sustained short covering or genuine buying interest remains to be seen.
I was prepared to short XLF at the open, but it did not falter in the face of the "loaners" (WM, CFC) decline. The market makers kept the bid/ask spread on the puts at .15-.25, which is not an attractive buying environment. At that point, the markets began showing some strength and I stood back from any notion of shortng (happily).
Carl Futia sees this as the bottom, with new upside targets yet to come. Check out his new guesstimates.

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