GE'less rebound..

Finally, after many days of declines, we got a rebound that had showed some charisma from many sectors, some of it only by speculation of more China stimulus.   If it wasn't for GE, JPM and those related to them, we'd probably closed near the high.   It's definitely a concern because the financial sector is clearly being dragged down by negative newsflow (GE-Capital) saga and market just can't make much progress without the financials.

The good thing is,  is maybe we have lifted some pressure off the talks of SPX 600.  Maybe the rebound today is inevitable in the face of tremendous selling pressure over the past few days.   However, we just don't know whether SPX 690, or 680 or 660 is the interim low to trade the bounce off.   For those that have been adding some positions here and there, today's definitely a day to pare some off.   We can see how easily this market can give up gains, so there's no need to hold onto "trading" position if it's already profitable.   Right now,  we'll see if this market is able to get back toward SPX 742 or not.  We are still on shaky ground and there's no telling if we'd head below SPX 700 and beyond in the coming days.   We don't want a market rising on foreign speculation, we want it to rise due to changes here!.   A lot of the factors that are associated with GE, JPM or Govt. policy are beyond our control.    Sentiment can change in a hurry and it's best not to lean heavily toward any one side.

What we do believe at this piont is that if the market pulls back and consolidates, there'll be buying opportunities.   Right now, oil stuff and as well as some tech stuff are showing as resilient plays during the past few days of selling.     In addition to our usual OIH and XLE etf as oil plays,  RIMM  and AAPL  as tech plays,  we are putting EQIX, SOHU  and BIDU  on closer watch as potential plays.   The last two also of course carry the China flavour as it's apparent that their market is behaving much better than ours during the past couple of months,  it has little to do with today's stimuli rumor.    Even though the financials did not fare that well due to the fear of GE capital, we are willing to give stocks like GS/MS  a shot on pullbacks as a result.    Charts from older favourite such as JPM  and NTRS  are showing deteriorating technicals,  so we'd avoid them for now.    As always, BAC, WFC, C are off our limits.  In all honesty, you only need so many plays to make up a small trading portfolio anyway.

Bottom line,  sentiment is very much lousy out there so people are still very cautious.  If there's any real rebound cooking here,  it may just be the result of an oversold condition, and not a major catalyst drive rally.    If we do get a significant and meaningful catalyst which we think will drive this market higher for a while, then we'll definitely change our trading mentality.   For now, take the profit as it comes and don't be lazy about it.