The equity markets have been quite strong this morning – the Dow is up 300 points as of this writing. If the NQ breaks above the tinted area, you can probably expect a hearty continuation of the rally.

It looks like the "election rally" is off to a good start. I usually have a pretty strong sense as to what's ahead for indexes, but I'm so conflicted right now, I think I'm going to completely back off index positions, either bull or bear.

I think it'll be a heck of a lot easier to trade once Thursday is here. The election craziness (sort of like FOMC craziness) will be behind us, and the immediate reaction will be done as well.

The next 48 hours are going to be terribly revealing – – it will be fascinating to see how the markets react to the election results. I imagine any big move will peter out by the middle of Thursday. If we get a sharp rally, I will take that as an opportunity to (a) sell off some of my more profitable longs (b) get into more short positions. As you can see from my watch lists, I have a bevy on both sides of the aisle. In just one of my accounts, I have 70 longs and 57 shorts! It's quite a mix. And even though 53.68 seems high on the VIX, we've come down over 40% from the peak. A big upward surge in equities could push the VIX down to under 40, which I'd take as an even better opportunity to short.

I remain long FXP and FXP calls. Some people have complained about losing money on this. What, do you want to catch it at the exact right second? I don't mind some froth. I feel good about the possibilities of this short.

The big ETFs are all mashed against their 23.6% retracement levels. An election surge would easily kick these up to the next level higher, but I'm already entering some put positions just in case we fall.

The ES e-mini has been boxed into an 825-1000 range for a couple of weeks now. The "exciting" part of this phase of the bear market ended October 10th. We've just been farting around ever since.

To quote Trading Goddess – – look at the volume! Or lack thereof. Today was the lamest volume since August, and that's saying something.

Here's yet another view of a major index. Each 1,000 will hold as resistance, or we'll take a final fly up to about 1070.

My Dow Jones utility short (via SDP) is a favorite of mine. Even if we surge up to 415, I'm hanging on.

I did after all wind up buying puts on the OIH. I'm somewhat conflicted about this, because crude oil could make a major push higher. I've got a relatively tight stop on these puts at 102.92, which was October 21st's high.

Finally, just in case you missed my little video creation from Halloween night…………it's worth your time: