We just filled Monday's gap as Friday's intraday high on the S&P 500 was 1135.13. While the charts say Monday's open was "1122" we all know there was a 4% move right off the open so the charts are somewhat deceiving. So we'll see if bulls make any sort of stand here - it is really no man's land other than a gap being filled.
That said, if this is any sort of typical situation it will call for a retest of recent lows. I don't know what recent lows "are" since Thursday's trading was so atypical. But excluding Thursday and going with Friday, the intraday low was 1094.15. The 200 day moving average is roughly 1110. Something in that range seems like a target if things deteriorate.
With Mondays the last 8 (is it up to 9?) months being an absolute rout for bulls over bears, the main question of the afternoon is will bears run for cover (get it? haha) anticipating the normal Monday follies. My gut says today will end badly, and a close on the lows should create a nasty Monday morning - but a nasty Monday would be so outside the box to be almost heretical.
I've thrown some downside hedges on (TNA, SPY puts) which I'll keep as long as S&P 1140 is not breached. (upward)
Friday, May 14, 2010
Monday's Gap Fills But Still Nowhere Near Retest of Lows
Best Of FMMF
- 1: Warren Buffet Piles on Europe
- 2: [Video] Jim Chanos Returns from Europe, Even More Bearish on China
- 3: A Chart to Open Our Eyes - Staggering Changes by Multinationals in Employment Behavior 00s vs 90s
- 4: Futures Blasted on Dexia Woes... and Poor Preliminary China Data
- 5: Market Working to Worst Thanksgiving Since 1932
- 6: Et Tu, German Bonds? Poor Auction Raises Eyebrows