The QQQQ and IWM gaps are filled. RE-ENTERING INDEX SHORTS.
Way too busy to be posting charts. Get your own danged charts 🙂
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Long QQQQ. Why?
Three reasons:
- QQQQ calls are extremely liquid and easy to trade
- The NASDAQ 100 is down the least this morning (it hasn't even broken last Thursday's low, even with all the news this weekend!)
- The contingent stop-loss price is pretty clear; either 42.36 (the day's low) or 42.57 (which I am using, since that seems to be the pivot point this morning)
Tricky Dick
MER. LEH. BAC. AIG. Ack! Ack!
It seems to me, given how the world has been completely turned upside down over the past 15 months, that it would be tempting for an investor to fall into one of two camps. One camp would be the "It's Cleaned Up" camp, which would view that, given the "cleansing" of FNM, FRE, LEH, MER, and BSC, the exorcism is done and we can finally shake off the credit crisis and move higher. The other camp might be called "Something Worse is Coming", which fears that a calamity underlying all the prior clean-ups is awaiting that no one can fathom.
The popular media promote – and have promoted – ideas from the first camp ever since the crisis began. You can find ample headlines from July 2007 saying that "the worst is over" when, in fact, the worst hadn't even started! I also think this sentiment is what can cause huge news days like this to result in the opening price begin the low of the day. Hell, in the ten minutes I've been sitting here (from 5 a.m. to 5:10 a.m.), the S&P futures have recovered 7 points! So if you told me that today closed with a small loss, or even in the green, I would not die of shock. Because people are always looking for that final financial enema to make the system well again.
Having said that, I approach this day with no small amount of caution. Things are crazy. When I went to bed, gold, oil, and the euro were all blasting higher. Now they're getting creamed! I see a lot of chatter in comments about how former morning plunges (like last January's) marked significant bottoms. I don't discount this, although I do recognize that the length of these post-bottom recoveries is getting shorter and shorter.
Seventy minutes until the opening bell. This is going to be another day for the books. Strap in.
Perchance to Dream
I'm heading to bed, but I wanted to "clean the slate" for folks commenting. I'll probably be back in front of the screen at 5 a.m. or so. Something tells me Monday is going to be an interesting day. See you on the other side.
