The futures are holding yesterday's gains quite well this morning. Oil is almost back at $98 and it's hard to short anything in this FREE MONEY BONANZE but we are sticking to shorting that line on /CLH3. The Dollar is at 80.67, so it can go lower and push things higher still, so keep an eye on that and, of course tight stops! Gold is looking dead at $1,205 but it bounced off $1,200, which is the -2.5% line and that should hold, maybe a long opportunity (/YG in the futures) if retested.
Notice Dave Fry got a higher volume reading than I saw in Etrade and Etrade now says 126.6M on the Dow, so a ton of stuff came in at the end but you have to respect a move like this – especially if it holds through Monday. As Dave notes:
" Lastly, we should remember the taper is merely symbolic as the Fed’s balance sheet will continue to expand and QE will continue to go directly to the Primary Dealer network. These funds should then trickle down, as has been the pattern, to the stock market."
Better to be in cash than having flipped all short but, obviously, it would have been nice to join the bottom-fishers (who once again were rewarded) for a big win. We went over our top trade ideas for 2014 in yesterday's Webcast and, if we hold these levels, then we have plenty of places to deploy our sideline cash.
Still, we certainly made a big enough list of stocks over the last two days to play if this rally holds – so no lack of things to do with cash and no lack of potential returns if 2014 is as crazy as 2013 was.
Quad witching Friday is the watch-word, it's the EOQ for options and people who want to cash out gains before capital gains go up next year only have 7 more sessions to do so. Also, notice the volume bar for this week – yes it's 3 days but look how low – I'm sorry but yesterday's move still doesn't make for evidence of anything –…
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