Rumors or fact?

Lot's of rumors over the weekend. An Italian newspaper claimed that the IMF would save Italy. Maybe the US would intervene to save Europe and Germany and France would be putting in some extra efforts to save the euro(zone). All this created a huge opening gap, most indices up nearly 3% and small caps even >4%.

Of course with such a big opening gap, you don't expect a rally during the day. And indeed, no trend day up. The market however held strong during the opening of the session and even managed to make small gains. Than we started moving sideways forming a wedge/triangle. As you can see on the SPY-chart depicted hereunder, price broke down and quickly headed lower. However, a very strong last 5 minutes brought price back in the upperhalf of the day (and for tech and small caps even near the highs of the day!!)

5m-chart SPY:

Daily charts DIA, QQQ and SMH:

Precious metals were up together with stocks, silver the better of them, +3%.
Oil hit 100 again but got rejected by that level. It travelled down again under 98.
The euro wasn't really able to benefit from all the 'bullish' news, only up small compared to what one would expect after all these rumors.

Trades
With the surprisingly big opening gap, my small TNA-position from last Friday was a huge winner, up 10% at the open. I sold the entire position @38.26 (long Friday @34.10).
During lunch, market pulled back and it came down all the way to a 61.8% Fib-retracement (between morning low and high of the day). A hammer formed and I took another long in TNA (small position). Long @37.85, out 1/4 @38.10, another 1/4 @38.30 and the remainder @38.18 (see chart below).

5m-chart TNA (awesome close, liquidating the bears that shorted the triangle):

Holiday trading - don't even bother

Today was basically a non-event. Down much in pre-market, an amazing rally and than a sell-off, just to end more or less where we were on Wednesday-evening. I won't even bother posting the charts for DIA, QQQ and SMH. They all look the same for today, forming an inverted hammer. In this context (very low volume holiday trading, only a half a day session), it doesn't seem very meaningfull imho.

5m-chart for SPY:

Trades
I started a tiny startersposition in TNA @34.00. I'll wait for a panic-sell next week to add to the position. Or a powerfull opening on Monday, but that seems rather unrealistic, macro-wise.

Slowly dropping towards previous lows

ES-futures gapped down on the open, rallied just over 1150 resistance and dropped back towards premarket lows. Ending the day close to the lows is bearish, ending the week near the lows of last week ain't bullish either. But on the weekly charts we also have a very bearish candle, albeit on lower volume than the previous candles.
So for the moment, I would put my money on the bears.

While the market clearly isn't looking healthy at all, there is still money to be made on the long side. In silver or gold that is. Both performed well today, especially silver (+5%).

Trades
Rather oversold at this point, a small bounce seemed in the books today. I went long TNA when the trendline of the previous day broke. Although the volume pattern looked great, there was no follow-thru and I was stopped out with a loss (-1.79%).

Later on, the same pattern formed on most charts; a triangle with lowering volume. The breakout occured with good volume and I went long TZA. I took profits on 1R, 2R and just above 57 (average: +1.97%). I could've made much more, but wasn't interest in holding over the weekend, certainly not with recent volatility. No need to get greedy...

Panic attack

Boy, was I wrong yesterday, thinking we hit the bottom. Stocks reversed overnight and made a new low +2 hours in the session. Unfortunately I didn't sell my SPY-calls yesterday, so today I added to them to lower the average cost (normally I wouldn't average down on a loser, but I started small, in case more trouble was underway).
I tried some more bottom-picking with ES-futures (1230) and TNA (61.98). Both got stopped out resp. 1226 & 60) and I tried again when the market puked some more near 1212 on BIG volume. And yes, that was A low (though not THE low). In on 1214.75 and trying to hold on to this winner as long as possible. I was looking for 1240-1245 on this one, but was stopped out per 1219.25. Tried once more later on; long 1219.25, stopped out 1216.25. So only a dead cat bounce intraday and revisiting the lows in the afternoon.

Of course, with indices down about +4.5%, there was little green on the screens. In fact, silver and oil plunged big time (6-7% intraday). Gold fell back from it's highs, but was still looking ok.

We're now down about 150 points on the S&P500 in only 10 sessions. That's a 11% move. Impossible to predict where this will end, but I won't try anymore shorts here. My initial short on the futures worked well but I suffered a medium loss on the bottompicking longs. Closed my SPY-calls as well with a considerable loss. All out now and waiting for a shortable bounce with good risk-reward. Will probably take a couple of days/weeks.

Wednesday 07/13: From greed to fear (and will there be new QE?)

What a day! Markets were waiting for Bernanke to speak to the Congress. And like clockwork, it happened again. Ben spoke, the dollar sank and stocks rose. All because dear Ben hinted a QE3 was possible. (Do people still know what QE stands for? Maybe they think it's a ship, the Queen Elisabeth III...)
However, Fed Governor Fisher doesn't want to support more action and talks about the US debt ceiling won't stop, 08/02 will be D-day. The rally was faded soon and back to scratch...
So far this week, bulls 0 - bears 1.

Meanwhile, rating agencies are competing with eachother to downgrade countries. It's all a game to them, so it seems. Greece, Italy, Ireland... I think they forgot Spain & Portugal this week, or maybe I just missed some headlines.

The gold rally from the last weeks continues to new highs, silver is braking out of it's June range and oil is heading for 100.

Hard to stay bullish knowing all of the above, but still, today US futures rise while European stocks are being sold. Let's see what earnings season will tell us.

I got stopped out of my TZA-position in pre-market but hedged it going long TF (Russell mini-futures) for a couple of points. Then during today's rally I tried TNA long, but since the rally didn't held, I'm back to 100% cash. No need to try other positions intraday, I'll wait for Thursday's close, hopefully that will shed a light to where the market is going in the short term.