The gap near S&P 1070 is now firmly in play... direct stop or some tourist attractions first is the only question.
Our puts are exploding up in value (only a 4% allocation since we shed so much long exposure there was not much to hedge against), if 1080 breaks convincingly we'll most likely add more and look to sell some around 1070ish, but certainly more danger lies ahead if 1085 is not recaptured soon. The 200 day moving average in the 1040s is now an intermediate target and probablility. As always the close is more important than the intraday action but so far, so ugly. For now we'll focus more on the short side, until/unless 1085 is regained,.... if the textbook is in play we should drift up to test 1085 from the bottom and if we're ready to put some bull horns on the mantle, we'll sell off from there. If not, this was all a bad dream (for now). You know the invisible hand will show up here soon to at least try to move things in the "right direction".
*If you plan to invest in my mutual fund this summer, please take evasive actions with any funds headed my way ;)
p.s. this action is all the more ironic since tomorrow we will hear great tidings of how excellent the US economy is doing with the government inflated 4-5% GDP for fourth quarter 2009. Rejoice.