Who else feels like this rally has legs?

D

diablo11

Does anyone else feel like in the spirit of the market will 'do whatever is necessary to hurt as many people as possible' That we are due to continue this short covering rally. Based on the Option Trading Indicators way too many people are still short and the longer that nothing happens as far as a massive failure out of Europe/China/US the higher we drift as short covering further extends the rallies. I definitely believe a large correction is in the future but that might not be until early to mid 2012. Check link below and look at how high the percentage of short positions are compared to historical levels.

http://www.schaeffersresearch.com/streetools/market_tools/investors_intelligence.aspx
 
To start with, 35.8 + 41 = 76.8

Are they telling us that 23.2% of professionals are in the sidelines?

Then, the bull-bear spread is not that big. I don't see where you got that most people as bearish and this is a short covering rally.

Third, are you watching the corporate earnings report?

http://finance.yahoo.com/news/Stock...5.html?x=0&sec=topStories&pos=3&asset=&ccode=

This is the real thing unless Europe screws things up. I bet they will. A bunch of f**kheads that tried to make a union. Time to get back to their currencies and leave the rest of the world alone to move ahead the bast**ds.
 
Quote from diablo11:

Does anyone else feel like in the spirit of the market will 'do whatever is necessary to hurt as many people as possible' That we are due to continue this short covering rally. Based on the Option Trading Indicators way too many people are still short and the longer that nothing happens as far as a massive failure out of Europe/China/US the higher we drift as short covering further extends the rallies. I definitely believe a large correction is in the future but that might not be until early to mid 2012. Check link below and look at how high the percentage of short positions are compared to historical levels.

http://www.schaeffersresearch.com/streetools/market_tools/investors_intelligence.aspx
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I know what you are saying and have been watching these as well. I myself have been mostly short for the past 3 months. In fact I was short Thurs and Fri until stopped out in the morning yesterday. However, I do not think the entire recent rally was a short covering rally. I have a hard time believing people will remain short as long of a time as they are willing to remain with a long trade....its human nature to want markets to go higher. As for having legs? well I think this coming week will tell us a lot about that. They may be a few more shorts to cover on Mon or Tues that put on positions at the upper end of the recent trading range but we have overhead MAJOR resistance at around 1250-1270 range on $SPX. If we break through those I may consider being more agressive with longs. Dont get me wrong I will be long now that we broke through 1230 pretty convincingly but I will NOT put my entire portfolio in on the long side. Only risking about 2% out of my max of 6% I allow myself to trade. Once I see what happends in the 1250-1270 area I will commit further capital on whichever side is winning. For me 1270 in a HUGE line in the sand for me to get excited about being long again.
 
Yea, I totally agree with the resistance above going to be extremely difficult to break through but I just feel like the next week or 2 is a time to be long with a decent amount of upside potential. I too have been short with moderate success for the last several months but it seems like everytime I allow my shorts to run something comes out of Europe and my gains are gone in days. I decided the market wants some kind of resolution and waiting for an announcement will be too late. I am tired of trying to fight the up drift we are in the midst of and figured its time to get on the train for a short ride and some gains. Everyone is so damn bearish right now and for good reason but the thing is that when you are short the timing aspect of it is so important that the mistimed shorts waiting for the Eurozone to implode can't hang in much longer and that will give the market the firepower to move higher, or hopefully high enough for me to exit.
 
hot-legs.jpg
 
I think the upside has the potential to move higher, that being said I put my long term account into cash a few days ago. Wait to see what happens next.
 
Just as the market broke down to the downside after it crossed 1100 it only stayed there maybe a day or 2, now the upside that everyone is screaming about is the breakout above the 1250-1270 area, so the SPX breaks out of the 1270 area and heads higher, who isnt to say that just as quickly as it jumped from 1075 to over 1230 in only 2 weeks that once it breaks 1270 it wont come falling back down below 1150 or 1100 once again. These markets have become irrational once again, everyone is going to rush in just as they did last time only to see the drop come once again, always happens, its not if its going to happen, but when its going happen.
 
Quote from S2007S:

Just as the market broke down to the downside after it crossed 1100 it only stayed there maybe a day or 2, now the upside that everyone is screaming about is the breakout above the 1250-1270 area, so the SPX breaks out of the 1270 area and heads higher, who isnt to say that just as quickly as it jumped from 1075 to over 1230 in only 2 weeks that once it breaks 1270 it wont come falling back down below 1150 or 1100 once again. These markets have become irrational once again, everyone is going to rush in just as they did last time only to see the drop come once again, always happens, its not if its going to happen, but when its going happen.
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As long as we have bear in the sideline, the market will continue to go UP. I am still not seeing those Bear change side and go LONG in the market, indeed this thread is the solide proof.

The market will only go DOWN when ALL the people are long & in the market, but this is not the time yet.
 
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