Thursday, November 8, 2012
The market seems to have completed the 5 wave count I posted yesterday and at the same time testing the 200 DMA as I predicted yesterday. And now the market is at a critical junction where it must rally from here to confirm that selling for the past few weeks has been a correction. If the market does not bottom at this level and goes into sub 1350 (specifically 1335), then the long term trend will likely change and a new bear market will begin. As of now I am seeing a double Zig Zag from the 1474 complete so I am placing a bet now as I have been planning since I first announced the short term bearish trend on 10/23 and the intermediate bearish trend on 10/25. I bought back my XIV position at the 200 DMA and I am hoping we will see a rally in the next session or two back to the Trend Average. Gold continues to rally and that supports the idea of a correction, also emerging markets seems to be on W4 so I am thinking all markets will rise in unison.. we'll see.
Long Term Portfolio: 100% Long (China and HSI Only)
Short Term Trading Strategy: Bought 1000 XIV @15.67 as of 11/08/2012 on margin. Margin positions in gold initiated 11/06/2012.