Tuesday’s action was following our most recent trend: DOWN! However, when GM news was released a flood of short covering hit Wall Street. This set off a wave of short sellers across the market to head for cover, pun intended. The market got to a point where it could not get anymore oversold and needed to blow off the steam from selling. New Lows (NL) topped out at 1162 indicated that a short term bottom was being put in. Unfortunately, VIX and VXN did not show we had bottomed whatsoever with the VIX merely peaking above 25 level during the morning swoon. We have everyone’s bounce, but unfortunately I believe the bounce will be short lived and yield little gains.
More to come. This rally will be short lived, with VIX and VXN not showing capitulation we will not see meaningful gains.
No Positions
