Yesterday I posted the chart below, suggesting that commodity holders should be prepared should the Dollar take out resistance line (3). (see post here)
CLICK ON CHART TO ENLARGE
What a difference a day makes. Below is an update to the above chart…
CLICK ON CHART TO ENLARGE
The Dollar breakout is really causing pain in equities and especially in the commodities arena, “FOR THOSE THAT REMAIN LONG!” Continue to believe that if we can get the Currency movements correct we can do fairly well in other positions! (see post here)
Keep stops in play per the “scoring on defense ETF’s!” Did some mention that QE2 could stand for “Quant Exiting?”
DK…if you want to score on defense, might look at a SH or PSQ.
The spread between NDX and VXN was close to the biggest in 10-years. One weeks of declines doesn’t unwind this situation yet. Keep in mind, I personally don’ think their is a thing wrong with “harvesting at the highs and setting in cash, while watching prices become cheaper!” Scoring on defense is nice, yet missing out on large declines is ULTRA-IMPORTANT!!!!!!
Would you hold positions like IYT in this environment (luckily I still have something I haven’t been stopped out) and pick up something on the short side like ZSL at current levels? Or sit on cash and wait for the “next” opportunity.