Wednesday, December 31, 2008

Caution Warranted as we Turn to a New Year; Dec. 31, 2008

Just a quick note: the market has continued this rally on somewhat strong breadth. I am very wary of chasing this rally at all because it's the end of the year and there's light volume today. I see this as a good opportunity to add to my shorts, which I did. I wouldn't be suprised if the market flips wildly in the last 30 minutes of trading today as players jossle for position into the new year. Wackiness is occurring today so caution is warranted reading too much into today's action. For example, the EUR/USD dropped 200 pips over night yet gold is actually up $5 today! Amazing. It's quite possible we will rally all day and then sell off hard into the close and then the selling won't stop for the next few weeks. Or, we rally today and a few of the first days in the January and then sell off hard.

I'm shorting rallies.


Michael K. said...

I am getting ready to short today since you are doing it. Happy New Year and I wish you the best of luck in 2009. :)

Todd S said...

Hey thanks man! Happy New Year to you too, and let's make this another year of big gains. I'm expecting big moves this coming year, and I plan to be on the right side of them.