Thursday, September 22, 2011

In and Out

10:03 am (Hawaii) Dow -391 (-3.5%) to 1,733, Nas -82.52 (-3.3%) to 2,455, S&P 500 down 37.17 (-3.2%) to 1,129. The move lower has been extreme, even with the late rally. I got out of my modest position in FAZ at 71.14 for a profit of roughly $6/share. Didn't sell above 74, 73 or 72. FAZ was hovering at 72 until the last few minutes of the session, but the selling pressure has been quite dramatic in the final two hours. No question there will be more buyers of FAZ for a long time to come. But near term, I was fortunate to catch the tail end of this big run. After gaining 14% yesterday, another 9% today (when I sold), it is likely time for a bounce in the market, especially the financials. Everything (except the US dollar) is so severely oversold.

I won't play against that kind of rubber-band snapback potential right now. But I will scale back into FAZ, hopefully at the right time in the next session or two (or three). I really would like to hold a position for weeks and months as the banksters tumble, but positioning is key in this kind of volatility. FAZ couldn't stay above 73 (near-term high) so I'll wait for a nicer entry point.

As for everything else, they all sucked. FAZ was my lone bastion of comfort. I'm not interested in trading TVIX or VXX these days. Maybe I should be. AGQ (165) and DGP (61.13) are above their lows of the day.

No comments: