Calibrated FV, 950.84. FV, 1154.85. Mid 1052.84. At this point I am convinced that any FED action is aimed directly at the equities market and has almost nothing (or probably secondarily) to do with job creation or IRs.
This is setting up for the biggest disappointment in a long time. Flat has already priced much of this in. A big spike up in SPX will be violently sold (98% of ETrs should stay away from today near 1:15 CT - don't try this at home sort of thing) since it is not news and priced in. So good news will be at most a momentum trade higher, and bad news will send SPX to 1142 over a couple of days (and then some). http://finance.yahoo.com/echarts?s=...=on;ohlcvalues=0;logscale=on;source=undefined
Calibrated FV, 924.54. FV, 1125.51. Mid 1025.02. Holding all shorts from SPX: 1220, 1186, 1171. 1160 is minor support that should go sometime on Thursday, with 1142 a very strong attractor. Only exogenous news can keep SPX from 1100 at this point imo, and one wonders where it can come from at least in the short term. In a way, it may be the best thing for the markets - flush the toilet, and then rebuild. I also fear that people don't realize how bad the situation really is, and I don't mean just in markets. Markets are essentially a rich mans game, and most rich people are insulated from the real hell that is most people's life. The desperation will result in something terrible.
Out 1 unit of three units short pre-market. Since cash markets are not open, I have to give you the approximate SPX price it would be, 113x.xx. Plus 39. Still holding two units short from 1186 and 1220.
Last time we were here the market ran almost 100 handles in my face. On the other hand, the context is vastly different. My insides are saying, Run! take the money! But it is wrong theoretically. So I sit on my hands.
what does your gut tell you about FV I would get out with a touch of that, to me 1120 is pretty close, anything under that is a gift, that said everyone could panic sell and get back down to 950, why not take a profit, if you are honest you don't know where the mkt is going next could rally or drop 100 handles, the point is to make a buck either way, good trading.
Well my gut tells me that this goes much lower. On the other hand, I took +39, and along with the +15 that I took a bit earlier (last week or so), gives me a decent cushion. The current positions have a very large open profit to them (about 90 + 40 = 130 handles more profit), but I genuinely think it is wrong to take this profit. I compromised even taking the +39 and wanted to hold all three units short, and in fact it was done as an emotional blanket to help me cope with a situation where markets would once again go higher irrationally. At this point, I will sell anything that comes close to 1172 SPX, assuming FV agrees of course.
Note that DJX is down harder then SPX. That is completely logical. Think it through. Very little makes sense these days, but this is the first thing that has made sense in a long time. DJX should continue to underperform, but it often does not because people use it to hide money. This is wrong this time. Don't hide money in DJX, either go cash, or go long/short.