Market Update

Once again, just like last Friday this market is proving to be resilient.  Going into today we were looking to the short side after the news that was coming out of Europe.  We opened on the Dow Jones down around 220 and it seems that the fear was once again going to be the theme of the day.  My plan coming into the day was to wait a bit on the open to let the market settle in and then look to the short side. 

Well just like last Friday this plan was proven wrong by the market and its participants.  We opened below the 105 level in the SPY and I was looking for it to hold under this level as 104.50 was the February lows and I figured that if this level broke we would go down at least another 100-150 points.  Once we got above this level of resistance I lowered my expectations but was still looking to the short side as long as the next resistance level of 105.60 held. 

We pushed to that level and it held so I went short LVS, BBY, and HIG around this time, which was about 10-10:15.  The SPY’s traded down to around 105 and once again this area of support held.  Honestly this was kind of unexpected and I didn’t cover my shorts quick enough, because I let my emotions get the best of my and was not managing my risk well enough.  I should have taken some of my risk off when the SPY held this level.  I lost a bit in LVS and HIG but made a good trade in BBY when it followed through. 

Going into this afternoon as long as we hold 106 in the SPY I’m expecting the market to potentially fill the gap .  The fear seems to be gone from the market right now and the bad news is being digested right now.  I have very low expectations for either side but am adjusting my plan for what the market is giving me.  Watch the financials for the market to tip its hand.  Right now they are all positive from the open, which is leading this market higher.  Best of luck for the rest of the day. 

Kyle