We made a nominal new low today with some very trade able volatility.
We had a clear 5 waves up and it looks like we may have had the first leg down already, so this would call for some strength early followed by weakness and a retracement to the levels marked on the 1 minute chart below.
The bullish part of today was the impulse rally structure of the market and also its ability to recover from a pretty sizable and a little panic stricken decline. We even managed to keep a put/call ratio in place that remains bullish for stock prices.
As I mentioned yesterday, we will know very quickly if in fact the low put in place is the end of the correction as the market should move sharply higher from here.
I remain 25% invested with my intermediate term trading capital and I am 100% long on the long term positions after lifting the hedge position.
If we get more confirmation that this rally is the real deal I will be making call option purchases on select issues, with GM and Ford to the forefront. Of course after option expiration I anticipate getting into some AMD call as well.
We had a great day on the day trading with over 15 points captured. If you have the time stop on by and take a look. www.lowriskdaytrade.blogspot.com
Also, if you could take the time to click on the blog elites Icon in the upper right hand corner and Enter and Vote for the blog, I would sincerely appreciate it and if you could make this process a daily ritual that would be even better. I realize that time is a valuable commodity, but it should really only take about 10 seconds of your time as once you click on Trend Analysis LLC you will be brought right back to the blog.
As usual I welcome any and all input and if there is anything in particular you would like to see or have covered, just drop me a line and I will do my best to accommodate the request.
Have a great week trading and I look forward to all of your comments and suggestions!