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