Terrible Fake Outs - Bull Trap? (9 Dec 2008)

Basicly, I am not very impressed with today's bounce. It can't go higher because there is no participation from people like you and me. Tell me if you did?

First of all...we have to ask ourselves what was the purpose of the gap up? Could it be that the market makers want to scare the shorts to cover...? If it is I don't mind at all....we shall see.

AZO, FDX has worked as expected....but tomorrow shall be a key day to see if we are heading down or not. I would'nt be suprised at all if these stocks turn green tomorrow to scare the shorts a little.

Basicly, SPY is still trapped in the descending channel. It should have broken out of this channel today if it really wants to stage a genuine rally.





Here is the chart of SPY showing potential levels for tomorrow if there is any big move. I just hate to see SPY end up smack in the middle again...keeping us guessing ....that sucks.




Finally, I wish to caution the bears because we are closing in on OpEx. So it is advisable to remain defensive in your trading because MaxPain for SPY is 100. So I wouldn't write of a rally to somewhere close to 100.



Strategy:
Daytrade only.

Watchlist:
Neutral: GS
Buy Dips: PNC
Potential Shorts: SAFM, FDX (Gone even before market opened...yikes)