Comments on today's action: still looks like just a pullback for now...mabey more to come tommorow

I was away from my desk the whole day but based on what I saw today, it still looks like we are pulling back rather than rolling over from an intermediate term (IT) top. Markets have just about worked off their short term overbought condition, but IT wise, it is overbought, so be carefull if playing the long side, but until proven otherwise, the market looks to be sawtoothing higher. A good long opportunity for a speculative call option purchase would be near SPX 805-810 I'm going to be watching carefully how the market acts at these levels instead of pulling the trigger blindly. I did not like how the VIX closed down today despite the market closing deep in the red. This indicates complacency. I would rather see a VIX pop on a dip that I want to buy. I am eyeing May XLF 9 calls for a small spec play when I believe the bulls are ready to take charge again. I love these types of plays because they are all or nothing plays i.e. I don't use a stop and therefore won't have to worry about getting stopped and whipsawed.

Fundamentally speaking the data is not looking good. Consumers are retrenching on credit like never before and this is what I warned about when I talked about the end of the super cycle of debt. An excerpt from marketwatch today reads:

"No other recession has seen monthly changes in consumer credit contract this many times or so deep before going back to January 1943, which is how far the data go back," wrote Young Kim, an analyst for Stone & McCarthy Research. The retrenchment reflects "less available credit, less consumer demand for credit, and consumers' new found propensity to pay down debt."

Comment: This makes it crystal clear this is not just a recession.

Here's another excerpt from Bloomberg:

"April 7 (Bloomberg) -- Thirty-five companies defaulted in March, the highest number in a single month since the Great Depression"

Comment: If it walks like a depression, talks like a depression....

It's clear as the day that we are in a depression, but like in the depression there were several counter-trend rallies along the way and the big bad crash of 1929-1932 destroyed both bulls and bears alike.