Inflection Point Opportunity

AT this point we are approaching a point of what I consider extreme resistance but with little support and I have taken a short position via SDS.

The resistance comes from the August 2008 high of 11,782 on the DJIA. All gaps have been closed at this point and market sentiment is at extreme levels so the opportunity here is great. A close above the 11,782 level would almost certainly cause me to cover this position.

--Fred

Bought SDS

I took about a 35% stake in SDS just before the close today. While I had expected an up market today and possibly Monday this market simply appears too weak to rally. I expect to be in at a 100% level soon as I expect the next 2 weeks to see the stock market drop well under the 11,000 level.

--Fred

Neutral on Market Short Term - Exited SDS Position

The Investor's Intelligence newsletter today painted a very bearish picture as bullish sentiment has risen to heights not seen since early May, two weeks after the market top. The balance to that is a very bullish short term picture painted by the Quantifiable Edges newsletter and the seasonal affect heading into the Thanksgiving holiday.

This morning I exited my short position with a small gain with the intention of reevaluating prior to Thanksgiving or the following Monday. I believe the stock market is likely to struggle off these levels and stage a rally for the next week, but regardless, I plan on letting the stock market clarify it's position before I take another position.

--Fred