the Yuppie Pig

Just a comment today as I watched the DOW fall another 300 points today - I found it rather strange to think of the DJIA, an index I watched growing up, at the 6700 level. It almost seemed out of a history book. Life goes on...

No point in stating that it was just a horrible day out there so I'll try to highlight some positives. I'm only going to show one chart today, because pretty much everything trades together in this type of selling. When this bounces, everything will bounce. Right now, the SPX is right at 700 - a rather nice round number for at least a pause if not a bounce. This chart is also extremely oversold and it's at these levels that one has to start covering some positions. I'd like to see the MACD cross back over and head up to believe that a counter trend rally has begun. That doesn't have to be tomorrow.



All of the sectors are selling in unison which I believe is actually bullish. No-where to run, no-whereto hide... not in defensive names, health care, commodities, or even gold. To me, this look like we are in the middle of a waterfall capitulation sell off that could lead to a counter trend rally. Of course, it could start at a much lower level than 700. I said on the weekend, I wouldn't be surprised if we saw the SPX at 700. 650 this week doesn't sound crazy to me either. It was also nice to see the VIX ending the day right at its peak. Typically, that's bullish as the end of day selling is likely to be more emotional. The calm of the off-hours perhaps will quell some things.

Despite all that appears bearish, in the short term, I have to be at least slightly bullish in the face of this relentless selling. I restarted a position in POT at the end of the day at $74.6. This is about a quick 15% cut from Friday! It's a gamble, but we'll see. If the market doesn't show any life, I'll have to immediately eject the name and run to the hills like everyone else.

But it's not all bad..!