The market moved so dramatically that we re-calculated the OEX and twittered out twice during the trading day. By 1.30 p.m. the theoretical Dow had hit 10,335, near what could be a support area, and a turn around, to as high as 10,870. When a market is down 240 points for the day we believe we've entered a true bull market. We have had down days with responding up days, and key support areas have held.
Many of our longer term traders had held our put, as we gave a "top sell," a stop loss date of Friday, and had Dow projections showing these numbers. These traders returned as much as 100% on their investment.
We're on the hedge side only now, with a new or dual buy to the call as an open signal, and are going to move the stop loss out
This week I've sent you Dow Charts, and it would be interesting to review now. You should.
We believe the SPX has a core support at 1100.
It's time for some philosophy:
January ends the “best three-month span” of the market, historically.
What this really means is that the market historically does little the rest of the year
The market can stay irrational longer than you can stay solvent – John Maynard Keynes, British economist
What this really means is that you are not right
The human ego does not like a vacuum-Johnny K.
This from our wise trader, Johnny K, suffering with brain tumors and talking with me regularly. I love this man, and the simplicity in which he understands there is no black and white.
While we spoke Sunday he said casually "the human ego does not like a vacuum." This goes with Floyd's "we are always approaching a drama, within a drama, or recovering from one."
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