As per Tuesday's post, the August lows are now within easy range and tomorrow may tell the tale, helped along by expiration, being Friday and being the start of a 3 day weekend. Looking at the charts it's hard to make a case for the long side at this point. Sure every market is oversold to the extreme, but don't let that lull you into thinking a rally is just around the corner. It may be, or it may be a long way off as I noted in my earlier 3 LR studies of the Qs and the VIX (which incidentally came alive today after maintaining a comatose behavior for much of the declines this week). Watch for 27.50 on the VIX.I did nothing today, finding no long setups that looked attractive and reluctant to go short at these extremely oversold levels. FYI, my feeling about WM was correct (short) , but I have few regrets about passing on the trade. Cash is my current safe haven as I figure its better to be flat rather than lose money, plus I will be occupied with a couple other projects for the next few days and the focus of my attention will not be on the markets.
The Qs are up .30 after hours, but as demonstrated by today's open, that may just be the cat waiting to pounce. Good luck out there.
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