Geithner says chill....everything's OK

Geithner sparked a turnaround for the bulls today saying that he believes the vast majority of banks are well capitalized implying that most will pass the stress test. The results are being released on May 4. If the market rallies into that announcement there's a good chance that there will be a sell on the news reaction. But that's looking a little too far ahead right now.

Once again there was mass destruction in the FAZ/SRS bottom picking cult. The amount of capital destruction those 2 etfs have caused must be at a record and yet I STILL see bottom fishing there with no fear. This is quite unbelievable. Bears it seems are getting angry that the market is not doing what they think it should and insisting that the market MUST drop. Well, good luck arguing with the market...just like arguing with a women who has PMS...you rarely win. It's best you just say I'm sorry or better yet don't get into the argument to begin with.

The gaps I had mentioned today got only partially filled. But I realize that I shouldn't get so hung up on unfilled gaps especially if they are minor ones. In the past it has cost me missed opportunities.

I couldn't resist selling my VIX puts today because there was a good bid by a trader in between the market maker's spread close to the ask price and since the spread is usually .15 with the July 30 VIX puts which are trading near .85, selling near the ask like this was too tempting for me to pass up especially since I believe the upside vs downside risk is about even right now for the next few days.

The next few days will be critical. Tons of bears I'm sure shorted at 875 (because it was such an obvious thing to do) and have stops just above that level. A quick revisit to those levels this week would probably be met with resistance unless there is some huge positive catalyst. A break above those levels could usher in panic buying. It would best for the bulls to see a couple of mild down days to work off the overbought condition a bit more before making another upside assault. The market of course doesn't care what I think it should do, so I'll be watching the action very carefully.