Did everyone just wake up and decide that small stocks were overbought? I was hoping to get in on the short side, but didn't want to risk getting whipsawed. But am still wondering, what's the reason for the panic dump? Would appreciate your insight.
the er2 overshoots on the way up {as compared to the es} and overshoots on the way down ---- that is the characteristic of the russell. it had more downside tension built up from thursday/friday/monday run-up to bleed off ---- and the er2 gets some nice point moves when the commercials plop on big bet orders {right now they are very heavy short --- and still holding}.
It was a great move. You don't get those very often. You usually get follow through the next day, also when ER2 is down the next day early 1.7%-1.9% very early in the day, you have a very good chance its going to pop back up as it did today. ozz
trading the er2 is the only way to make more then a crack dealer -------- 650 and still selling --- what a ride!
i was scaling out on the way down and then re-entering small size positions on kickbacks, but i pulled the last ones and called it a day for my er2 trades at 649.50 --- i will use any major rallies in the er2 over the next few days to re-enter short positions in conjunction with the signals i use. the foreign money that came into our markets thursday and friday {at the quarters end} was a gift to enter new short position trades at friday's close coming into the month of october. monday and early tuesday required some trade management to better the cost basis of my position with the little pops the er2 had, but once the 1230 level was broke for the es i felt we had some good downside potential. there are too many economic conditions which are still putting pressure on the markets and this makes holding market highs very tough.