Opening Observations

The strong open has been faded by market players. This is what I am seeing:
  • The pattern of out performance of financial stocks and consumer discretionary over commodities and tech is continuing.
  • There are a lot of Puts being bought. While the market fade should be concerning to the Bulls it would be more concerning if there was heavy call buying.
  • What would make for a great shorting opportunity in my opinion?
    • S&P 1320-1350
    • Financial companies using the rise in prices to issue more common stock to the public (ie. not to sovereign wealth funds or private equity)
    • Heavy call buying
There are hard calls and easy calls in the market. I believe right now this is a hard call, especially because the market pulled back already. I want to protect my capital and wait for an easier pitch. If I miss my opportunity to short at least I don't lose any money. Be careful.

No comments: