Yesterday at about 340pm, the US government, through Geithner’s treasury department, leaked a plan that will allegedly help distressed mortgage borrowers lower payments.  The plan boosted the mood, forcing end of day short covering, raising the S&P 500 back to a key resistance level around 835.

Today is the last trading day before a three day weekend.  We could certainly see an increase in volatility as a result.  Mr. Geithner’s department leak seems to have been strategically delivered to stave off another leg down.  Yesterday we were testing the 813 level of support, which looked to be giving up as the S&P traded as low as 810.  After 813, the last major support is 800 before we look at the November ‘08 lows in the face again.

Nonetheless, significant technical damage is being done.  The Dow Jones industrial average made a new multiyear low yesterday, the transports continue to sag and the only index with promise, the Nasdaq, seems to be finding less buyers lately.

Posted by Alex, filed under Economy, Options, Stocks, Technical Analysis. Date: February 13, 2009, 7:24 am | No Comments »

The VIX has bounced off the 20 day moving average after briefly testing it earlier in the day.

We saw it hit the top bollinger band, as we have many times in the past.  Each time it reverts to the 20 day moving average.  Once there, it reverts to a higher high.  Today’s earnings disappointments from GOOG, MER, MSFT and opening up with C’s likely bad earnings seems a setup for more losses.

vix.jpg

 Every financial was oversold, and every financial rallied.  Seems to me the most logical course now is to continue down.  Most shorts in the oil market will cover before the day is over.   Fridays are tough for equities because no one feels like they are safe in the market over the weekend.   Should play out well for our positions.

Posted by Alex, filed under Options, Stocks. Date: July 17, 2008, 8:25 pm | No Comments »