Friday, August 27, 2010

Minor Wave ?

One of the best lessons I got from being a subscriber to EWI was not to take any count too seriously(after following their official bearish count on a massive bullish rally). I covered all my shorts yesterday and kept my FXI long hedge because I wasn't sure of the waves. My count pointed to an ABC move to where we closed today but almost every single count I saw (with the exception of one other waver) had a 5th wave of a III to break the 1040 support. And being conservative worked out well today as this "C" wave throws a wrench in most waver's count.

The rally we saw today has the strength to become a real rally, so I am expecting a further rally to challenge the 50 day MA at 1086 once it's done retracing. I am not sure of the exact labels for the Minute count so I am going mostly by Technical Analysis at this point. I took a 1/2 short position at 1060 (the one I sold I sold at 1053) and I will sell at the retrace of this "C" wave.

Portfolio 1:

1/2 Position SDS at 1060, Full Position FXI taken as an hedge at 40.36

Portfolio 2:

1/2 Position SDS at 1060

Up 17% since 07/10 inception vs -0.5 S&P500

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