Thursday, May 14, 2009

Man, that was fast

If today's the end of the rally, it sure didn't mess around. The past few days was "sideways action", while today was when prices crossed support left and right. I saw pattern breakdowns across the board on Wednesday. All four of my stocks fell out of their ascending triangles and I got out. Only my casino stock, GM, went up (+5% I might add).

FAZ had also gapped-up and held. I bought in, late in the day, near an XLF support line betting on another breakdown. I also gave it a tight stop in case it's a head-fake. Looks like FAZ is up another 3% so far in the pre-market.

I think it is time for the rally to be corrected, now. I was starting to detect a sense of euphoria in the news, and could hear reporters talking of "The Recovery" in the present tense. Meanwhile, stocks were trading sideways and drawing out those ascending triangles. I'm glad to see this remark from the Big Picture, too.

However, this could also be a short bearish correction, turning failed ascending triangles into flags or channels (more sideways or slightly down action).

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