DJIM #44 2008
Monday, November 3, 2008 at 08:22AM Sometimes a little hope and a little superstition goes a long way it seems!. Hopefully, many of us put on our fighting gloves and participated in the tumultuous Halloween week that we noted as a possibility before Tuesdays morning. By weeks end, the SPX gained 100 pts from the possible push rally we were alerting Tuesday, now comes the harder part in predicting where it may or may not go. Was this just a pre election rally, or do we continue for a post election run?. There's going to be many scenarios played out in the media, but we're staying away from making predictions today, we'll just go with the flow as at this point we're facing a resistance area, a fight at 970 and the upside is not going to be another quick 10%. We are looking at SPY 110/ SPX 1100, if all stays on course as next area of importance.
What was spooky last week was as if we're in a muzzled quiet period as 'NO' bad news hit the street prior to election day. It's as if all the dislocations in the financial markets just went away. Poof!..all gone!. yeah, right..everything has worked so fast. Anyways, that's our conspiracy theory for the day.lol....but, truthfully... honestly, it's not too far- fetched, so we're thinking we'll get some bad news late in the week or next week.
If we are going to get side-lined money into the market, we need to see stability and tighter low-hi trading will bring confidence back slowly. This was probably the best aspect to the last 3 trading days and we hope it sticks.
A few things, we'd concentrate on this week is earning reports based on last weeks performance. Simply, we expect a better reaction to good reports in this better environment, we are using CMP, EMS as a basis for this. Otherwise, we'd stick to the ETF trades we highlighted last week, below is a comparison a member sent us that shows the potential prices of the SSO, SDS trades (long or short) with the SPX moving in either direction. Remember, these are 2x!.
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**A few members had asked to keep the Halloween special to add-on to current subscriptions past the weekend, we'll keep it on for members till election night.