Thursday, June 12, 2008

Feeling GASy laterly? No worry, inflation will be as tame as it has been!

Bulls jumped higher on beer and oil in the early going today, only to gap and almost crap as they found that the mixture was not exactly a shot in the arm. Tomorrow's CPI probably will bring a lot of volatility and bulls better hope that the bad news has been priced in the precipitous drop in the past few days.
While I will still seek bottom-fishing setups, I am turning more cautious after reviewing all the charts tonight (especially GE): I will further lower the ez for my stalking list (AMZN, BIDU,DYRS, EXM, CRM, CSIQ, EWZ, LUK, MA, PCLN, GS). On the other hand, if the market gaps up in light of CPI, I may consider shorting AAPL, APA, GS, CF, MON, POT, FSLR, AKS.

The bottom line: with relatively low VIX reading (meaning not enough fear), the expected technical rebound may not worth the risk of further downside, especially given next weeks ER from troubled financial sector plays such as LEH, GS, etc. This might be especially true for those who plan to hold the bottom-fished position for more than 2-3 days.

5 comments:

fortune8 said...

If I wasn't reading your blog, then I would not know what DYRS is.

You have done well waiting for DRYS. Nice !!!

fortune8 said...

FSLR shorted 269.75 again.
Let's see how this works.

RazoR said...

Locked and loaded on drys at 71.70 bought protective 65puts on the gap up, 7 points either way here is fine with me...also bought yhoo 17.50 put just for kicks...

flyingwabbit said...

razor:
regret not to act on your drys call, considering all the successes trading it, it should've been a no-brainier.
Just bought POT July 220 puts when it broke the tight trading range around 226.5 a few moments ago, let me see if I get lucky here, stop just above 227....

RazoR said...

My gawd you mean pot actually goes down? :P
Thoughts Gap and crap, we're only a couple bad sessions away from a triple bottom on the dow and these rallies don't feel right...aapl is fckd up, does it go to 155 or 185 first, lower highs, lower lows...