They both will eventually die. Check following URL with 6 months time frame. http://www.google.com/finance?q=FAS+FAZ+XLF
Most of this is what I said, but you said it more intelligently than I. I will repeat my recommendation and get out on the highest high you can get, and then reset your trading. The concept I think is called "Time to Money" or something similar to that.
They won't "die" they'll find their baseline, which will continuously change. The baselines for all three dropped to march 6th, then FAS and XLF baselines began to rise with the bull market. While FAZ continued to fall. The long ETFS are at approximately the same worth they were when the market was in the same price range before march 6th, while the short ETFs are still losing value. Yes FAZ is up right now, but when the market turns away from this bearish trend for the week, it will drop back down to the baseline it had established previously and then will drop some more with the next bull rally.
I'm going to sell more than half of the FAZ shares I purchased last week http://www.elitetrader.com/vb/showthread.php?s=&postid=2417861#post2417861
Wow. That worked out perdy well. Price broke out of the 10:30 NR7 bar and never went below it. Out at 6.18.
I beg to differ. Lets see what happens to FAZ when they start nationalizing the banks...starting with Citi.
Up almost 14% on my FAZ position which I initiated yesterday afternoon. Normally I would be right out, but I think I caught the top of the financial rally and now I have some cushion where I can let this thing run if I am right. Let's see here.... Banks rallied over 80% off the March lows as a result of the government's clever market manipulation, which caused one hell of a short squeeze, which led to a change in general market sentiment. Now a flood of equity offerings are coming to the market, tech is getting crushed and the news flow is turning decidedly negative again. Looks like the rally is over for now if you ask me. Good Luck all of you FAS holders!
This is a great newbie thread about what not to do. Never mind that you should only trade 3x instruments when you've been around for way longer than a year, but that won't stop the market from taking your money. My opinion FAS is oversold, but pointing lower, so while it's outside of fair value, the fact that it's shifting towards pointing lower should tell you something. The closing prices form a hump, like a roller coaster, and this points lower the day after, but could still be up from the open if the open is low enough.
Well I got out of FAS earlier in the day. Today has been crazy for me at work so not much time to talk today. Sorry. I am in faz right now, and will watch closely.