In market conditions like we have experienced the last thirty or so trading days you must be prepared to change your trading posture according to the situation right now. Today the market powered up in move that must be respected. The letter we wrote earlier today is still good advice and is worth being followed by prudent investors.
At the same time today’s power bar broke the downtrendline of the latest downwave. (Chart to be posted tomorrow.) We will be adjusting our personal positions to tilt to the long side.
The situation remains extremely fluid and volatile. But it is possible that the market considers: 1. That it has sprung a bear trap, and 2. That a sufficient flushing action has taken place to take the market up.
This is certainly one of the most dramatic roller coasters we have been on in all our years in the markets.