The market has been clearly oversold lately, so contrarians, short sellers and mischief makers, each trying desperately to get a seat before the music ended, drove the market up over a percent in the first two minutes of trading, and then the slow movers drove it even higher. While explosions like this often result in the initiation of trends it is for certain that they initiate trades. so we initiated some trades. Bought the silver; the Qs; the TBT (short TLT); took off part of our hedge on the SPX (SPXU) (at a profit).
It looks to us like Apple’s nightmare has ended.
A reversal day Friday and a gap today on strength. Worth a trade. If you were long and observed our previous comments you just had some uncomfortable moments. Now the pundits will have to eat their words and hopefully a full helping of crow. Reading the financial entertainment press is bad for your financial health.
The nature of the day, and the gap in TLT lead us to speculate that a new wave has begun. Whether it will lead to the long bull wave we are expecting is anybody’s guess (and let us emphasize, it is a guess.
We cook up things in our alchemy shop and use the latest wizard’s tools (and the truth is it works better than any other method, but it is not a science, although from moment to moment a scientific instant peeks through) but there is as much art as there is science.
The long view.
The close up. Let us emphasize this is a very speculative interpretation., but sooner or later the bond sky has to fall and hit chicken little in the head. Maybe if those turkeys in Washington get their chicken guano together it will happen.