Market view

What a very nice reversal we got and start of a sell off yesterday !

Markets did not bounce a lot ,, but steady selling all the way into close with FXE(EURO) going down lower as expected. I believe eur/usd might be on the way to test 1.24-1.25 area.

Overall I think this was the "start" of the sell off which is going to happend - and I think we are resuming our bear market. The DOW JONES made new highs ,, but SPX and NDX did not - this is called a bearish divergence in the dow jones theory.

I got major sell signals in all indexes which means the trend has turned from UP to DOWN now -- so if we get any bounces from here,, they should be shortable as long SPX stays below 1265 area.

We might even bounce to near this area,, and then begin next sell off - but either way ,, I remain heavy short and long TVIX and TZA which is up with amazing profits both now.


So not much to say other than I remain heavy long TVIX and TZA and not selling a single share right here as I think much more downside ahead and a test of 1100 not out of question in January.

One thing which is very interesting is that SPY index and lots of other sectors made a "BEARISH ENGULFING" pattern which is usually one of the most bearish candlestick patterns out there. A RED close on Thursday will confirm this pattern - and then it could really get ugly if a red close today....