The Dreadful Quandary

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Unless you're hiding in a cave with Osama bin Laden, you know that tomorrow morning's jobs report is supposed to be a real market-mover.

I'm feeling horribly conflicted. At the moment, I've got some nice profits from today's modest downdraft, and after September, believe me, I could really, really, really use those profits. So the nightmare scenario is for me to hang tight and have the market explode higher tomorrow, instantly turning these profits into losses. So the "bird in the hand is worth two in a bush" notion is throbbing inside my head.

Yet these are good charts, and good positions. And how foolish I would feel to cover everything, just for the sake of enjoying some modest, feel-good profits, only to see the full potential of these shorts blossom in a sell-off tomorrow. I've worked way too hard to accept some small profits as consolidation for all this labor.

But that's the nature of risk, isn't it?

A lot of folks in this position might say something like, "Well, I just know if I cover all these shorts, tomorrow the market will plunge." I'm inclined to say that sometimes too, as if the market gods secretly have it in for me. But that's just stupid, isn't it? There are no market gods; there's just the market. And it will do what it wants to do (Shalom notwithstanding).

Some others might say, "well, cover half the position." I guess that reduces risk, but it dodges the essential question: does one stick with charts until such time as they are stopped-out, following the rules I've mentioned many times, or does one play it safe, simply for the sake of playing it safe?

I have no conclusion from this. I'm just typing out loud. I'll continue looking at charts and figuring out what the logical next step is. But – as STU pointed out last night – the talking heads in financial media see the jobs report as a Can't Lose situation: if the report is bad, the mother-f*cking QE2 is forced into reality, and if the report is good, then the economy is good, thus high prices are justified.

Maybe the mere fact the bulls are convinced there's no way they can lose tomorrow is enough reason to know that they'll probably lose.

Your input and thoughts in the comments section, as always, are appreciated.