And They’re Off!!!!

Straight up 28 handles right out of the gate. Paper sellers on the bell, locals long and the market just went straight up with little effort by the locals. A big Paper buyer came in at 65.00-64.00, locals found their buyer, and the market just kept going. The May 6 crash low was 1056.00 in the mini and 1060.00 in the bigs.

We tested this low on the bell at 1051.25 in the mini and 1051.50 in the bigs. A huge rejection of that tested low caused the rally. That can set a great double bottom and we can be off to new highs……..unless we retest that low again. Typically a 2.5-3 handle “test and reject” can set the tone for a change is trend and we would then consider the action since the end of April as a correction of the bull market since March of ’08. We went a little deeper than the 2.5-3 handles but that could be chalked up to the increases in volatility.

However, in my opinion we are at a critical point. I would have preferred not to see and move back into the range of the crash which would suggest that it was an anomaly meaning prices would never return to find Value at that level. But they did, and that’s not bullish. If it wasn’t for the fact that we rejected that low so vigorously Friday I would say tighten your helmet straps cuz is going to be a long 2-3 rear ride down the Slope of Hope.

Meaning if we head to the 65-00- 52.00 area and rotate, finding Value, there is a good chance that the decline will continue.

If so this offers traders a rare opportunity. Declines can be sharp and fast. Elliott Waver’s are calling for a 3rd of a 3rd wave which occurs when EVERYONE heads for the exit and the door opening cant handle it. This would be caused by the baby boomers who are heading toward retirement and they cant stomach their 401K statements shrinking as they witnessed in 2000-2003 and 2007-2008. Those memories are too fresh and they are too close to needing that investment. Add some car bombs in Times Square and elsewhere (this I am afraid isn’t a matter of “if.. its simply “when”) and more bank failures (this too is a when, ) and we can have lots of panic on our hands.

If we do head up from here and the Vix remains high we will continue to have 10 handle intra day swings so either way we should have some great near term opportunities….cant wait

Tim Mack




“If you are going through hell, keep going.” - Winston Churchill