When I fired up my iPad from bed to see what the markets had done overnight, I was puzzled by a very strange sight. Everything was up mildly with the exception of the Dow 30 futures, which were down hard. I had never seen anything like this before, and I assumed there were two reasons: either it was just a data error, which is pretty common in finance, or there was a single extreme outlier in the Dow.
As you surely must know by now, it was the latter. Specifically, an organization which excels at sucking up premiums and dispenses with payments in a niggardly and parsimonious fashion: United Healthcare (UNH) which is getting nuked.
I regret to state that, although I’ve done many bearish posts about UNH, I have no position, but I’m not exactly kicking myself about it since it wasn’t a particularly obvious setup.
Still, it’s heartening to know that their executives are seeing their fortunes and reputations shrink this morning. All of which is to say that this single stock is dragging the Dow down. Ironically, I was patting myself on the back yesterday for covering my DIA short out of “prudence” when in fact a nice profit was waiting for me.
Very broadly speaking, however, the gains this morning aren’t enough to get rattled about. Over the course of the past week or so, the /ES has been gently curling lower. It’s going to take some kind of shock event to lurch us to a real break, and obviously no one knows if that will happen or if we just meander our way into a three-day weekend.
In the meanwhile, I remain rather aggressively positioned (about an 8 out of 10) and will, chart by chart, tighten up stops and fine-tune as I see fit. Good luck out there on this final day of a shortened trading week.
