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Has the day of vindication finally arrived? I have been warning of prices being overextended to the upside for several weeks now. A number of traders cut losses when the equities moved against them as it did me, but those that stubbornly had some conviction may be proven right. To date in 2013, we've seen an unprecedented appreciation, with the S&P prior to today higher by just shy of 100 points, or 6-7%. In my opinion, things do not justify this type of move. Money printing and the "monopoly" money being injected into the system has given investors the false hope that circumstances have improved and they have not. I am not doom and gloom, but rather, a realist.

I've been consistent in saying when prices break the 9 day MA -- identified by the red line in the chart above -- we should see a break lower. I've suggested using the Fibonacci levels on the chart above as your objectives. My first target for those still in bearish plays in March futures would be the 50 day MA -- the dark blue line in the chart above.

Short ES futures or buying March or April puts is my suggested play at this juncture. Those looking to stay with the trade for perhaps a bigger correction could be short June futures and sell out of the money puts 1:1 or in June bear put spreads.

Risk Disclaimer: The opinions contained herein are for general information only and not tailored to any specific investor's needs or investment goals. Any opinions expressed in this article are as of the date indicated. Trading futures, options, and Forex involves substantial risk of loss and is not suitable for all investors. Past performance is not necessarily indicative of future results.

Source: Commodity Chart Of The Day: S&P