It's really only 4 percent!

So, yes, I was pshyched to see a 400+ point drop, as I was overweight on short positions (or long puts). I sold my GOOG puts two days before and took a bath on them... They were to expire in three weeks, and I didn't want to go into the weekend with them. Oh well.

So today, the market did very little: +.56% on the S&P 500. Good stable day for bulls, but what they'd like to see is a definite sign of buying into weakness, which we didn't really see today. Volume was heavy, but lower than yesterday.

In the end, the market hasn't decided yet. Look at what Mish had to show, chart-wise. That is a seriously unbalanced market. Look at his VIX chart. That kind of volitility can't be sustained, but the fact that the market was so biased towards the sellers, means that there is still a downward possibility to this market. Adding to that possibility is that market insiders are saying "hey, it's only 4 percent. Not even on the big day list" means that there is still a good deal of complacency, despite the VIX.

My guess: we should know by Friday, or Monday at the latest, which way this market is going to go. If it goes south, short CAL (suggested by Trader Tim), which has just completed a head and shoulders pattern:

If it goes North, I like HQL which took a light beating and gives a good buying opportunity:


That's it for today. Interesting times!

//

DNA

One more note... DNA has closed its breakout gap. Low-risk entry point right here. Sell if it closes below 85. If you're into options, June calls, contigent stop at 84.50.

Unfortunately, I'm back...

Hey ya'll, I'm back from my blog vacation.

So I'm bullish on PHO (an Al referred stock) and HOLX. I also like RATE. Each has a strong breakout in place.

Google looks like it's at a negative inflection point. If it can break 452, it looks likely to close its gap up, and base at 440. If it breaks 440, it'll probably return to its triangle breakout point, around 425. Keeps your eyes on it. Many of the talking heads are calling GOOG cheap at 35x earnings. Perhaps, but the space is getting more congested and competitive, and the ad based model is notoriously volitile. If corporate growth lags this year, GOOG will be extremely vulnerable to cuts in large corp ad spending.