Thursday, April 03, 2008

The turning point or the point of no-return?

As the major indices are approaching the Feb/March highs, tomorrow's market reaction towards the March employment report may determine the overall market direction for the coming months. Will there be another huge rally to bolster the bullish case by posting the first higher high since last Nov thus confirming the intermediate bottom, or will bears be able to smack the bulls down to keep the the possibility of the second legs down alive?

Judging from the deep overbought conditions across the board and the oversold VIX, I might bite the bullet by going short if the market gaps up big. My short list: AAPL near 160, FSLR near 264, JASO near 22, SPWR near 87, STP near 50, V near 69 (stopped out just above 65 today), YGE near 24.5, BIDU near 300/305/325, and WLT near 75/80 as speculative play. On the other hand, if the market gaps down big at the open, unless the overall volumes really spike, the sell-off might be short-lived, and buy at bottom might be considered though will be risky if the market cannot recover late in the session. In either scenarios, it is prudent to be nimble when taking profits, especially on the short side.


flyingwabbit said...

looks like a waterloo here for me, added another half short position at 279.88, the second half will be stopped if it breaks the high again, talking about out of the control...

flyingwabbit said...

covered half of FSLR at 173.22, the other half was way under water (should I say high and dry under the sun?), so is the SPWR position, talking about the bad sun burn for playing reckless under the sun! shorted BIDU at 298.88 for just 3 points. Say, anyone who knows any stocks that are more overbought than FLSR, ever??
enjoy your weekend while I will nurse the sun burn.