Valid Rally or Short Covering? | Investing Adventures

Valid Rally or Short Covering?

Today the DJIA was down over 200 points on comments made to the Senate by Bernanke.  The last hour or so of trading saw a 180 reversal in the DJIA and the S&P  and seeing them close only fractionally.  My question to you is this.  Was today’s rally a result of dip-buyers taking advantage of the sales or was it a result of the bears covering their shorts?  The technicals for the DJIA and S&P have broken down and as a result I would expect more downside in the near-term but today’s action doesn’t justify that thought.

4 Responses to “Valid Rally or Short Covering?”

  1. I really have no idea what today was but its hard to be short for a extended period of time.

  2. It’s just a mess out there. I cashed almost everything out this morning. I’ll wait until things clear up a bit or play more of a limited risk/reward with some call/put spreads.

  3. Even my money management strategy could not save me this time. Lost quite a bit. I think I should get my money out of the market and go on vacation for some time.

  4. Already one step ahead of you. My confidence is a bit shot so I’m stepping back for a couple of days, reloading during the weekend, and hopefully executing next week. I worry, however, that next week is options expiration week.

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