Tremors Before A Larger Corrective Phase
Dr. Duru | May 30, 2013 05:36AM ET
: 54.0% (ending a 13-day overbought period)
VIX Status: 14.8
General (Short-term) Trading Call: Hold shorts. New shorts should stop out on close above Tuesday, May 28th high.
Commentary
The day after the S&P 500 printed a major reversal pattern, the Japanese Nikkei Index tumbled 7.3%. I only realized the damage getting done after I posted my last T2108 Update announcing “My
trigger for puts on CAT is working well. AMZN on the other hand is behaving as stubbornly as ever. The post-earnings trigger only lasted for a day, and I did not take the small profits that small swoon produced. I think there is still time to catch the next swoon…
Black line: T2108 (measured on the right); Green line: S&P 500 (for comparative purposes)
Red line: T2108 Overbought (70%); Blue line: T2108 Oversold (20%)
Be careful out there!
Disclosure: Long SSO puts, long CAT shares and puts, long AMZN puts spread
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