Yea, I would imagine if the rally continues mon - tuesday, and we break and hold 2000, the shorts will get very nervous. They saw what happened to the bulls that stayed bulls too long, and most will have learned from that and not let it happen to them. My guess is if we rally some more, most shorts will cover, take their profits and run...close out their puts and tec, etc.....then they will sit and wait and after a couple of nice rallies they will come in and try and short again.....they will either suceed, or it will be just like last year in reverse. Many bulls pulled out at higher levels but re-enetered at lower levels....but we kept dropping. Possibly same thing happens in reverse....The shorts will cover if this rally continues, but then at 2300 or so, they will try to short again...maybe we go to 2700....and etc, etc........with every few hundred point move, you have the shorts trying to do their thing..........what will happen is the magic question......do we restest the lows, see a nice sustainable rally.....base around 1800 - 2200 for awhile.......who the hell knows...certainly not I....but I do admitt, the naz rally has been impressive so far since last week......next week will be highly interesting.
keith |
