Nov. 7, 2006: Smoke and mirrors

Ok, I'm back after a long summer (& Fall) break.

The market behaved like I expected - yesterday's action was all smoke and mirrors that one could smell it few miles away! Today I walked in with a clear short bias (Thanks J for confirming my bias :) ). Yes, early morning runup threw me off a bit but after looking at breadth and my newly minted (highly secretive) shem-indicator hehe confidence grew that this upmove was manufactured. Shorts were entered at multiple points and worked out well. A long trade was thrown in there for good measure (I call'em airhead trades) and didn't work out of course. Lesson learned: 'Stick to the f***** plan! Thanks you.'

Pls. note that we've had a 'V' on the Dow which revisited previous hi. What makes Vs bearish is the speed by which the second leg accended. Any time, it runs up hard to revisit a cautionary flag should be raised.

Ok, so it's elections time back home and the Dems might be taking over. As for impact on market, it usually tanks when them Dems move in da house. I'm going for a consolidation on Wed. with fireworks on Thurs. & Fri. since there're major news coming out on both days.