Wednesday, August 16, 2006


My guess yesterday for a down day was wrong.
I got out of a runner - early as it turns out - but I made the target and am happy. The runner was PETM and I have no idea why it gapped down and then ran for the top.

Sold the GLW I held overnight `on the gap up also. So two trades completed two profits banked - doesn't get any better than that.

Now we have hit a bad spot - Thursday before expiration day (Friday) in August. After three gap ups in a row on the indices you probably should rest.

Old Japanese saying - buy, buy, buy and rest and that kind of suggests the three gaps we've just experienced. The first gap is loose money testing the water, the second is the big boys buying inventory to sell the suckers and the third is from the shorts hoping to keep their shirts and buying from the inventory holders.

Supporting this is the fact that the up/down ratio remains above 60% but actually off from yesterday's 70%. The new 20 day highs number 1224 to the new 20 day low of 140. The DIA finished the last hour in the red but the Q's and SPY both made white candles in that hour.

On the other hand the VIX is 15% below its 10 day average and that generally means a down day.

Guess for tomorrow - down.

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