Tuesday, February 17, 2009

Ominous Break

Hey folks. Well, today turned out to be a stellar days for the bears. Down 37 points or 4.5% on the S&P 500. After gapping down this morning, the bulls were unable to muster up ANY sort of intraday rally. (I'd post a SPY 5 min. chart, but am on the road with my laptop, which unfortunately lacks SNAG-It). We've been monitoring the symmetrical triangle of the market for a few weeks now, and after Thursday's head fake, it seems as if today we finally got the decisive break. Moreover, we also broke below the pivotal 800 level on the S&P 500.

With today's price action, it's tough to get excited about going bullish (with a few exceptions of course... eg. gold, some technology, etc..). Until we see a break above resistance, I still like the idea of using market rallies to reload on bearish positions. To those of you that had bearish positions, congrats on some well earned profits! Just a reminder, this Friday is options expiration for February contracts, so make sure you adjust any short Feb option positions accordingly (e.g. buy to cover or roll forward to March).