SPDR S&P 500 (SPY)

[gumbie05]

Had a decent day yesterday in that I was able to increase my dollar cost average (in my overall short positions) which is now hovering near the high 487-88s but it was a bit painful nonetheless as the move up yesterday was very aggressive. Will try to lay out (some more s. sales) where I can above 491-93 range in any bounce this morning. My eyes are still on the DXY because it’s so weak in that any attempt to rally past 102-03 range is met with immediate selling and that’s what’s fueling this rally in the market (ie liquidity) in the face of deteriorating fundamentals in terms of increasing layoffs and stubborn bond yields (ie staying above 4%). The big signal that I’m looking for is when the DXY sells off AND there’s no immediate rallies in the markets. In other words - when the markets can’t rally higher despite the infusion of liquidity! That’s the signal I’m looking for. We’ll see….

- JMHO