Recent events have compelled me to have a more open mind about various market possibilities. I present to you three different ideas about where the market could take us for balance of this month.
Scenario One: At Long Last
This is my favorite, naturally, since it pushes down to the target I've been positioning myself for; it takes us to about 925 before reversing and, for the balance of 2010, the market would pretty much head higher.
Scenario Two: Bullish Breakthrough
Here we have the market breaking the 1130 level and fulfilling its target of nearly 1250, surpassing April's high price. At this point, I think every bear in the world would be dead.
Scenario Three: Bullish Fake-Out (AKA Tick Everyone Off)
If you believe the market exists to fool as many people as possible, this is the scenario for you. It would push the market above 1130, get everyone buying like mad, and then flip around and create losses for all parties.
The maddening thing, of course, is that if we crossed 1130, there's no telling if Scenario Two or Three is at play. Strength at this point would be the worst of possible worlds for bears, because it not only results in losses for existing shorts, but for bears that finally jump into the bullish camp, they are at-risk of losing there as well, should the market finally do what they've long wanted to head lower.
My opinion as to which is the most likely? I have none.
