Monday, November 16, 2009
Market Surges Higher, So I Closed my Short Term Call Positions
Today the market surged higher and appears to be in the tail end of a 5 wave impulse rally on the hourly charts, and quite possibly a "blowoff top" in the larger picture. Whether this will complete the entire rise and make a top or if it's just part of a larger move up I don't know at this point. With the quick gains I made in my call option positions on the rally from last several days I decided to close those short term call positions at a profit like I said I'd do on a rally in my last post. The internals are very strong today and the US dollar continues to weaken, all fueling the big rally today. Some interesting behavior occured though, where the dollar sold off about 100 pips in a short period of time then rallied to a high above it (see attached chart). This looks distributive, much like the behavior in the stock market, where big institutions are moving out of positions and into safer assets. Silver voided that sell signal I mentioned the other day and has surged an amazing 5% today making a new high and confirming gold's rise, at least on the daily charts. The Russell 2000 made a new high above last week's already as well, but not a new high above the key level I've been discussing here.
There is no end in sight to the rally at this point. Until weakness resurfaces, I'm still short term neutral.
PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.