That Upward Trendline

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Well, the Market Focus for tomorrow from Barron's ("How the Smart Money…….{brief pause}………..Got That Way") is a real barn burner. Here we go:

Your guess is as good as any on durables and the clunker effect. 

Anyhoo – – those who have been on Slope for a while know that I used to focus almost exclusively on the Russell 2000 for indexes. Back in those days, I didn't even know the /ES existed, and I didn't mention the S&P that much. Anyway, the $RUT has out-gorgeoused itself in wonderfulness with its massive head and shoulders pattern. This thing is huge……….Christina Romer huge………just amazing. But, should the bulls grab the reigns again (as they've done, oh, about 17 times this year) there's nearly 7% of "risk" left here, as I've tinted.


I beat a hasty path to the Exit door today with my really big shorts, although I re-entered my GLD short pretty late in the day.

The best possible scenario (realistically) for the bears would be something along these lines with the /ES below: a pop back to the low 1050s, an approach of the trendline, another attempt up, and then a trendline failure. At that point, it's kind of a different ball game, and it's going to be a matter of the bulls trying furtively to take control back from the bears and not the other way around.


The last couple of days have healed a lot of damage that my portfolio has been suffering. I'm hoping for a good Friday to wrap up what would be the first really good week I've had in a while. Suffice it to say the last two days have been highly restorative to the soul.