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The market was all over the friggin place. Who is ready to give up and go home? Thats a good sign if you are. Up and down all day with a big rally that happened at 3:25 then a big sell off at about 3:45. When the VIX gets up to these levels the moves are excellent. In hindsight I should have waited with some dry powder to trade the leveraged ETFs on an intraday basis, but its not the end of the world. With my RUT position I lost about -3%, while the NDX did -1.4%. The NDX was holding up all day long and even went green around 3:25 then sold right off at the close entirely due to financials getting crushed right into the closing bell .

The market is very oversold right now and just like last night with the proposed discount window plan for the GSES, some other market moving news will pop out of Bernanke or Paulson’s butt like Quato in Total Recall somewhere down the line. If not this week, next week. I’m hoping for this week due to my position, but if a move up either tomorrow or the next (maybe after INTC earnings) does not happen then the scenario of a higher close on Friday deteriorates and the probability of the scenario for the following Friday moving higher goes up considerably.

There are enough catalysts this week that could spark a rally. IMO the risk for an upside trade is lower than a downside move from these levels. Yes there could be a spike down in price and a spike up in the volatility indexes, but it could come on an intraday basis and you would have to be perfect to capture the move if not in ahead of time.

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