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Looking at a chart of the SPY dating back to last Tuesday’s reversal higher, you can see that we are dealing with pretty textbook holiday trading action. The market is inclined to continue to drift higher on light volume, which makes shorting rather frustrating. I still think we see some sideways action in the broad market this week, but that reason alone is insufficient for to turn bearish. While I put on some solid short trades in AAPL and CRM earlier this month, there is a time and a place for everything. I have little interest in trying to short this type of action, and will probably lay off bearish bets until 2012.
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Interesting how the Russel 2000 has lagged other indices, and TZA doesn’t seem to want to go much below $26. Are you anticipating generally downward action through the first week or so of January?
I’d say more sideways/slightly higher.
Cool, thanks for the reply.