About twenty-four hours ago, I did a post suggesting XLU as a short. I entered a massive, short position on this bad boy.
Reddy, Player One!
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Tweaks and Geeks
A cheerful morning to you all! I wanted to bring you up to date on my own positioning. I sold my SMH calls yesterday afternoon at a decent profit (and before the end-of-day price plunge, which was nothing but good luck on my part). I still think semis could be in for a good counter-trend rally, but I honestly didn’t want to stick around.
I also covered my way-too-large XLU short for great profits, although I have retained my NEE puts for the longer haul. NEE is a major utility, so it’s a similar trade, and I think the setup is a beauty.
Turning of the Screw
The VIX blasted from about 14 to 24 in recent days, which typically has meant the termination of fun for the bears, forcing them to wait, yet again, for weeks or even months for another chance to make money. I’m not so sure it’s going to roll that way this time, but let’s take a look at some action in a few major cash markets, accompanied by a trio of exponential moving averages (50/100/200).
The NASDAQ Composite tagged the 200-day EMA, which normally marks the end of a sell-off. It goes without saying that the resumption of the bull market following such a sell-off is not perpetual. All trends end. My spidey sense is that this one has, too.
