The Market Is Testing Major Support At SPY 108 - If We Close Below It - GET SHORT!
This week, the market has continued to struggle. It has broken the uptrend line from March and it has broken horizontal support. If it breaks below SPY 108, we will see another leg down. Only a few weeks ago, we saw excessive optimism and that bullishness needed to be flushed out of the market. Almost every analyst on CNBC was bullish, 80% of all newsletter writers were bullish, option implied volatilities were near 18-month lows indicating a high level of confidence and call option volume was extremely high the week before expiration. When sentiment reaches these heights, sharp declines occur. Bullish …
January 28, 2010
• Posted in: Options
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