Wednesday, August 3, 2011

Searching for the bottom

I'm not really into bottom-picking or knive-catching, but after such a huge plunge, one is inclined to look for a nice buying opportunity. So when the markets went south once more in the first hour, I added to my SPY-calls bought yesterday, lowering my initial cost. The S&P-futures hit 1230 (I was still short from 1272.25) and bounced hard. I held on to the short future position, now hedged by the SPY-calls, looking to sell the latter on strength.

Market formed a triangle from which it broke out. Right after the breakout, volume started pouring in.
After a pullback, we went up again, respecting the rising trendline and closing at the high of day, which also was the pre-market high. A strong day for the bulls, we seem to have our bounce.

In the mean time gold and silver are making new highs, while oil keeps dropping.
The EUR/USD is still very choppy, no real edge here since we're rangebound from May on. A big wedge seems to be forming on the daily chart.

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