Tech Weakness, but Too Many Bears Make a Minor Floor

Options traders on the QQQQ are overly bearish, so we should see some of yesterday's weakness reverse today. Nevertheless, the tech sector is weak due to fed bank policies in Japan and fears of further weakness do not appear to be going away anytime soon. As such, institutional money will probably keep on selling the rallies as they seek to sell down their inventories to the sleeping point (the point which they can sleep easier). The market is really in a state of indecision at this point. Selling pressures have abated somewhat, but buyers are certainly not rushing back in. There remains a lot of uncertainty related to future rate hikes and upcoming earnings. We would continue to short bounces in tech and consider a few longs in commodities. Cash is a good place to be heavy in though until next week when some of the question marks overhanging the market find resolution. Technically one of the bigger question marks is will we get a bounce prior to a hard move down into the expected 4-year cycle low, or will the market drift and then plunge, or will we get a tradable rally that then sets up for a bigger drop. With such widely contradictory possibilities, it makes sense that the market is confused right now.