Market rallied strongly on Friday. To be honest, I did not expect this much strength. Now we are again at a cross-junction. I think market has to reverse back down within the next 10-12 points in SPX for atleast a retest of the lows/channel bottom.
Since I covered shorts before the rally started, I am content with being on the sidelines comparatively. I did trade the long side on Thursday and Friday and made some coin while we wait. I also entered a couple of bearish spreads toward the close on Friday. I suspect this is early and we may continue the pop upward for a little bit more. But with the internals bearish as they are it is unlikely that we are going to see sustainability to this rally.
Not too much to add on internals. The bounce has turned the MCO upward but it is still far from the zero line. As long as it remains below, I will remain bearish.
The overall AD line also looks quite bearish in spite of this current bounce.
So the plan is to continue with these bearish positions atleast for the next 1 week after which we re-evaluate.
Gold continues to be bearish and my NUGT put positions are doing quite well. Let us look for a real washout here soon.
Best,
PM
Since I covered shorts before the rally started, I am content with being on the sidelines comparatively. I did trade the long side on Thursday and Friday and made some coin while we wait. I also entered a couple of bearish spreads toward the close on Friday. I suspect this is early and we may continue the pop upward for a little bit more. But with the internals bearish as they are it is unlikely that we are going to see sustainability to this rally.
Not too much to add on internals. The bounce has turned the MCO upward but it is still far from the zero line. As long as it remains below, I will remain bearish.
The overall AD line also looks quite bearish in spite of this current bounce.
So the plan is to continue with these bearish positions atleast for the next 1 week after which we re-evaluate.
Gold continues to be bearish and my NUGT put positions are doing quite well. Let us look for a real washout here soon.
Best,
PM
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