Thursday, May 6, 2010

Yikes...that was a scary few minutes...

Today more than a few traders got smacked around hard as the computers took over and drove the market down and then back up in the space of about 30 min. Fortunately or unfortunately I was at work minding my own business when someone said the DOW was down nearly a 1,000 points. Looks like the market hit one of those airpockets and dropped like a rock for a few minutes before stabilizing and ending the day ONLY down 3%+. Well, I guess the sad thing is I never set my sell trigger (on my May calls) at 1080 (my initial target) because, to be honest, I figured we had several more days to go.

So, where does the market go from here. There is no apparent impulsive pattern at today's lows, so if we go up from here, then that would be very bullish. We have yet to have anything but zigzag corrections, so what I would like to see is a nice triangle form over the next couple days between 1140 and 1080 before testing those lows and finishing the pattern. We technically got a monthly reversal today when the market went below 1077, but I would like to see it for more than just the time it takes to cross the street, so let's see where it goes from here.
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