Current Long Positions (stop-losses in parentheses): CHK (33.55), EWJ (9.24)

Current Short Positions (stop-losses in parentheses): None

BIAS: 15% Long

Economic Reports Due Out (Times are EST): Consumer Price Index (8:30am), Jobless Claims (8:30am), Industrial Production (9:15am), Leading Indicators (10am), Philadelphia Fed Survey (10am), EIA Natural Gas Report (10:30am)

My Observations and What to Expect:

  • Futures are up strong – in excess of 1%. 
  • Japan was down 1.4%, while the rest of Asia too was down more than 1% in trading. Europe is trading much higher seeing gains range from 1.5% to 2.5%. 
  • Selling continues to rapidly increase, with the declines that we are seeing, as the S&P pealed off another 25 points, and as of yesterday was trading in the negative on the year. 
  • Today’s large gap up is very legit and likely to hold. It will force a lot of bears to suddenly cover their shorts – but I don’t think this bounce is going to last – instead I think if played right, offers a great opportunity to eventually start shorting this market again. 
  • No need though to rush adding short positions right away today – could see some follow through too, and see the S&P push as high as 1300 again before finally selling off again. 
  • There is a plenty of “open space” for the market to run today – selling of late is extreme, market is oversold, and there is no overhead price barriers until the 1300  market on the S&P. 
  • My conclusion: This rally, while I believe it will trend strongly today and even possibly into tomorrow, will only provide the bears ultimately with better shoring opportunities. 

Here Are The Actions I Will Be Taking:

  • Added EWJ at $9.69 at the close. 
  • Took profits in FFIV of 3%, GOOG of almost 1%. Sold AAPL for -1.5% loss. 
  • Will look to scale out of my two long positions today. 
  • Additional trades will be intraday trades. Not trusting this markets ability to rally for multiple days. 
  • Follow me in the SharePlanner Chat-Room today for all my live trades and ideas.

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