Ok, the market is acting just like I expected... we got the 1-3 day bounce/sideways action...next I called for a downside move to make lower lows. I think this is exactly what happens either tomorrow or Tuesday (Monday is a holiday) If I'm wrong and the market charges ahead to challenge the highs that move is likely to fail and markets will drop back quickly. That's the way I see it right now.
Bottom line: I don't think the bulls are ready to make another charge to new highs. I still believe lower lows lie ahead. We need to see more fear in the market; we need to see shorts press. Right now the shorts, although quite sure a major downdraft is immanent, aren't being so bold with their bets just yet. I suppose after getting violated repeatedly by an angry bull they are a bit cautious right now.
I will be watching the action tomorrow morning quite carefully and I will consider buying puts on any morning strength depending on the action for a trade. The market has been shrugging off good news and has rolled over from a high and not too many bears appear to be pressing... those are the kind of ideal conditions you need to play the short side....it's not foolproof but it's gives you a lot more of an edge than going short just because the market has "gone up a lot" like a lot of retail bears learned the hard way. When you short just because the market has gone up a lot it can be the equivalent of standing in the path of a speeding Mach truck with you hand out saying "stop! You’re going too fast!". I'd rather wait to see that truck blow a couple of tires before attempting such a bold feat.
On a completely off topic note, I'm relieved that I'm just about done all of my wedding planning. I've also learned to dance a decent tango...my mom will be impressed I'm sure!
And now here's a cool song from Metric...a band up here in Canada.
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