TODAY’S THOUGHTS
I further continued my routine of liquidating long positions into today's strength. Furthermore, I added FAZ to my growing family of inverse leveraged ETFs. I still have my eye on adding more FAZ and possibly adding some SDS to the mix to round it out. I already have some EDZ from late last week.
My new outfit. I'm the one with the red gloves and nice teeth.
We did manage to take out the line in the sand for the bears at around 54 on the QQQ today. It was a strong close and the burden of proof is now on the bears shoulders, as the bulls seem to have taken back control for the short term.
In the end, these are all short-term problems if you are bearish. The positions I am establishing on the bearish side of the trade are more intermediate to long-term. I am not looking for a quick strike. Rather, I am playing a decisive change in trend that I believe is taking place in the markets for the first time since the 2009 bottom.
I will add to shorts using inverse ETFs slowly if the market is to continue to rise. I will also be out of my long positions completely by the end of this week.
I am looking to add to inverse ETFs if we manage to hit 1230 on the S&P or if I see signs that we are in the process of breaking down before we get to 1230.
Going into September and October this year will be treacherous to say the least. It seems there are a good deal of puts that were purchased during the first part of August that need to be cleared out before downside volatility returns. I'm expecting a break of the recent lows in September.
I'm willing to be patient with this one. Got my bear suit on. Zipped up tight.
