Pardon me for saying that. But I have been writing for the last few days not to short the market and that whipsaw is expected. I wrote that such a strong up-trend will not turn on a dime and it will re-test the highs. So it did yesterday and today. I think it will make one last effort to break the 1378 mark and then roll over. For the bears, the good news is the previous high has not been broken and we are on track for 1-2-3 trend change. By the way, the cycle high was between March 6-9. So tomorrow may be the ultimate fade date.
We still do not know the end result of PSI but it is still a default. All kinds of numbers are floating around. What the market is celebrating about? Sovereign default is positive for the market? Next in line is Portugal and Ireland. Ireland will be holding referendum and Brussels is uneasy about it. Spain has given middle finger to EU and has told them to shove it you know where. Only way the market can go up is when Bernanke shows up with more free money. The question is who will wink first. The TBTF banks or the FED? I think it will be the FED. Expect QE3 in any name by June 2012.
Yesterday I wrote that with NYMO so deep in negative it is difficult to have any sustained sell-off. The smart money has already distributed at the top. The entire ramp job is to lure in the dip buyers who are sitting on the sideline. But NYMO is still negative and I would expect it to get above zero 1st before we see the real deal.
I am not sure how this is going to work out. Friday has been the most bearish day for quite a while. And tomorrow is also a NFP day. The pattern of the NFP day is open high, go lower or open low go higher. I will take a call in the morning about taking a short position. Tomorrow is so very important! In the middle of all the euphoria, gold struggle to get past $1700. I think something is not right the goldiland.
I have updated the trend table which is as follows:
But I am not taking any action as yet because after a long period of trending, market is now choppy.
So that’s it for today. Thank you for reading http://bbfinance.blogspot.com/ . Please forward / retweet the post to your friends and join me in Twitter. (@BBFinanceblog). As always, I welcome your comments and suggestions.