Quote Critique

"Writing a book is an adventure. To begin with it is a toy, an amusement; then it is a mistress, and then a master, and then a tyrant." - Winston Churchill (British statesman, 1874-1965)

This quote appears to bear little relevance to trading, but if blogs are like books, then I'm still in the nascent stages of amusement. In my naivete, I do not see how a labor of love turns into a tyrannical endeavor, but that is a secret time may reveal.

Manic Markets

The market continues to churn in a wide range, but there are some signs of change.

Hedged trading has begun under performing the underlying index, signaling short term bullishness. Volatility is falling, but remains high, so stay cautious.

Tuesdays selling may be a capitulation point considering the ratio of down/up volume.

Up/down volume on Wednesday is in an uptrend, so look for markup and accumulation.

The NAMO has stopped falling, and though it remains below 0, it could turn bullish fast.

TBT has showed impressive strength in the last few days, even during the sell off. This is my favorite long candidate, target ~50.

The weakness in the VIX is encouraging, but one day does not make a trend. I'm still very cautions, and more liable to sell rips than buy dips. Nevertheless, if Treasuries continue to fall, I will begin to get long.