Well, I've had it to just about here (pointing to forehead where tin-foil hat was removed….perhaps prematurely) with this market. Yesterday there was technical damage all over the place – just what we wanted to see – and today the dollar lost all its gains and the market just lurched higher. Not good.
My only bright spot was my short in AMLN, which I covered almost immediately when it was down over 50%. But that one position constitutes a very tiny piece of my overall portfolio, and overall the day stunk. Ironically, a portion of the losses came from attempts to hedge via DIA, but the market absolutely spasmed the last half hour of the day.
We seem to be at "critical junctures" just about every few days now, but – – sincerely – – we are at one now. Here's a look at the NASDAQ Composite:
Incidentally, even though the POMO Market From Hell has only been terrorizing us bears for about seven weeks, it feels like seven years. I've circled the WTF portion of the market action, all of which is POMO driven (I believe Boston said we actually get a one-day reprieve from POMO insanity on Thursday).
The aforementioned DIA is right on the cusp of a potential breakout. I understand that China is going to be putting out some important economic numbers at 10 p.m. EST Wednesday. That's probably going to shake things up in FOREX-land and may well determine what Thursday will be like.
As usual, it's all about the Euro, folks. Below I've drawn a red line marking pretty much the land in the sand for the bulls and bears. If we cross above that red line……well……the bulls can continue partying.
If by some miracle the dollar rallies tomorrow, that would actually make a lot of sense given the UUP chart below. Tuesday it zoomed higher; Wednesday it lost all of its gains, completely filling in the big gap. A true countertrend rally last a couple of weeks would be much more possible in this configuration that with the huge gap up we saw yesterday.
Anyway, today's action really, really took the wind out of my sails. It's a real shame the beleaguered bears can't get more than a single session of a "trend." One day, POMO will lost its effectiveness, but only God knows when that day will come.