Thursday, July 7, 2011

Back in Business

Back in business after a long absence due to circumstances. But I will try and post daily messages from now on.

The indices are going up, almost parabolic it seems, closing in on the highs of the year with Nasdaq clearly the leader of the pack. But the longer this rally lasts, the deeper we might fall.

I tried a long-position in TZA (in 31.47, out 31.38) because of the big gap up this morning. But with the euro reversing higher and different positive newsitems (including ADP and jobless data), the market couldn't even fill the gap. So the bulls knew to keep control for the eighth day in a row. Let's see how much longer this story continues, but I'm guessing we're near the end of this run.

We have two possibilities now: sideways consolidation or a pullback/correction. I expect a pullback after such a big run up, with todays gap up being a possible exhaustion gap.

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