The bottom line is, this market has been very volatile and as hard to trade as any market we have seen. As such, we would not add any more to the short side here, but we certainly would be very hesitant to go long and we would certainly hold current short positions open.
Tuesday, August 15, 2006
Why are the Bulls so Confident?
Commentators are nearly all barking in unison pointing to relative strength and good breadth on yesterday's rally. Bulls are sure that bears are leaning too hard and that bears are ready to have their comeuppance served to them on a platter. Bulls in fact are so confident of this that they purchased nearly 2 1/2 call options for every put option on the QQQQ yesterday (remember, anything over 2 is overly bullish).
We can't understand it. Yesterday we posted a chart of the QQQQ and pointed out how the price has tried to break the downtrend twice over the past several trading days. Yesterday marked a third high volume rejection in just the last seven days.
The bottom line is, this market has been very volatile and as hard to trade as any market we have seen. As such, we would not add any more to the short side here, but we certainly would be very hesitant to go long and we would certainly hold current short positions open.
The bottom line is, this market has been very volatile and as hard to trade as any market we have seen. As such, we would not add any more to the short side here, but we certainly would be very hesitant to go long and we would certainly hold current short positions open.
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