Joe...
The bullishness is just for some short term trades right here.
Yesterday, I was only looking for a midday rally that never came until very late - although it bailed me out with modest profits, what I was looking for was a midday rally to short once again, which is the normal pattern with a strong downdraft to start the day. The normal trading pattern is that when you get a large move in either direction in the morning, a counter trend will come around midday and the market will then resume the morning trend in the afternoon. It is my experience that when the midday counter-trend never shows up, either the market will make a strong additional move in the original direction or if it just lingers without a trend, you frequently get an afternoon reversal.
Yesterday it did not work - it finally rallied but the rally then failed instead of being a reversal. Sometimes my timing chain just gets out of kilter and the odds fail.
Today, I was expecting a rally into the close because of the INTC cc since so many folks were looking for a very good call from them. What I had forgotten about was the capex announcement that was possible, and I think that is behind the extreme weakness in the equipment stocks the past few days, and that continued weakness is what prevented a rally this afternoon. My original plan was to take profits on any morning ramp tomorrow and short the morning gap.
Nice plan, but again it did not work. The afternoon rally again got me out with profits (better than yesterday), but the rally was unable to sustain itself into the close. I still have the four long positions, and the market is oversold enough that we may still get morning strength to get me out and depending on how things look I will probably short tomorrow morning expecting the Iraq situation to weigh on the market again tomorrow.
I do look for a rally next week - we are getting pretty oversold, and also it would be unusual for an intermediate term rally that has made new highs to just turn around and go straight down without the bulls trying to get the rally going again. I do not expect new highs and look for the rally to be short lived and fail, and that will be the time to go seriously short, with a lower low and lower high in place. Should all that come about, I look for the markets to retrace most, if not all of the rally.
Not all that bullish, just playing what I see, and of course it does not always work out as expected.
Hope that helps explain my seeming contrariness.
mlsoft
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