Wednesday, January 02, 2008

Intriguing Action

The action remains poor today, but something is missing for a complete breakdown here.

Indeed, volume is on the heavy side and rising; the indices are showing big %-declines; some key stocks are breaking important levels while the Nasdaq is breaking its 200-day (so if these do not pivot-back higher, they are broken from a trading perspective); Europe is following suit; the Semi's are getting hit very hard; the dollar is hit again; gold is breaking out to the upside; oil is approaching the $100 level.

...but with this many clear negatives I would expect market breadth to be 3-1 negative at least, and that just is not the case. We are presently closer to 2-1 negative on Nasdaq and less than that even on the NYSE at this point.

This will be interesting - we are either beginning a decent slide lower now, or we are setting up for a good pivot-higher. Either way, I like the volatility and I'll grab this wave; see which way it wants to break.

I covered half of the AAPL short at 193.20 (this was my largest position for today by far; no longer). I am adding a bit more short to WFR now.

I've been hit on the SBUX today, but other longs here are more than holding their own while my shorts are dropping very nicely (nice image). Others longs at moment remain COH, C, FWLT, GENZ and ONXX.

I will cover the remaining AAPL if it can get back and hold above its 10-day (193.65). I will try to hold the FSLR and WFR further , unless the market manages to recover strongly in the remaining few hours. Something which is entirely possible given the lack of negative breadth.

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