Today will be short.
The market is still pzchzoid (spelling?? no idea :) )
but the reversals on attempted sell offs accompanied with volume must be viewed as strength. Must respect the tape... and right now.. the tape is saying we go higher.
900-905 is still the neckline of the inverse H&S. We are getting close again. Today the financials showed up to play... the commodity space is still lagging.
look for financials to continue plowing ahead and for the commodity space to make a strong move up soon that really pushes the market over 900. Could happen anytime between now and the end of next week.
Because of the strength showing up,.. I think any additional sell off back down under 800 is probably off the table. If that were to happen, it would kill whatever confidence is brewing and it would be a failure of the inverse H&S breakout.
On the other side... if financials pullback and commodities fail to make a move.. i.e. oil keeps sinking and doesn't start a sharp rally.. if gold still flounders... if basic materials don't try to join in the rally.. steel, aluminum, etc.. (X, AA, etc) Then a potential failure to break out should be considered a high probability.
Current positions;
Long 1000 FAS 18.65 average
Long 300 ERX at 36.45
Only 30% invested.. will be hesitant to add more without a breakout over the neckline.
GL trading.
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