I was tempted to sell my 715 and 710's when the market broke through resistance at it's low (down about 125 at the time) 715's were bringing 11 and change, the 710 was bringing 9. A friend got me in a conversation about selling the 700 and bringing in $8,000 on a spread. While we talked about it the market started back up and I decided to wait for another down day tomorrow to sell.
If I had sold my Puts, I would have tried to buy more when the DOW moved back to -70.
T.A. still shows substantial selling pressures. I have a feeling that we should see the OEX down to 695. It might go lower if the general investing public (not the professional money managers as they have already sold within the past week) starts to lock in their profits. It was encouraging to hear a female analyst on CNBC tonight recommending profit taking to investors.
If all the carpet baggers, oops I mean buy side analysts, have had time to move to cash since last week, then maybe we'll not see so many say the "correction" was last Friday. Today was the first day of a real correction- breaking through resistance levels, small rally attempts and ending the day down.
Bonds are the key at this time. As long as yields can start back toward 7, we'll see continued selling.
They were saving the INTC analyst for just such a day. Believe it. Had it not been for INTC keeping the tech sector in place, we would have seen a 200 point or greater down day. IBM couldn't come in yet because they are going to have trouble meeting estimates. The media is trying to center on INTC and Microsoft. They'll bring in USRX, Cascade, and anybody else with upside earnings potential to stem the downdraft.
None of them can keep the market up if the rumors are true about the Japanese pulling out of our bond market. Jimmy Rodgers has been hammering that fact across CNBC nearly every time he has been on since last summer.
If the next 2 sessions are down, look for Barron's to finally start admitting to Greenspan's "insightful" remarks. Everyone has heard of "DFTT...don't fight the tape." They'll be adding "DFTF...don't fight the Fed", or even "DFG"...don't fight Greenspan.
Those Dec 725's I saw yesterday in the 5's sure look even better in today's light. |
