The market has turned the intermediate term bullish by breaking above the 1332 level. So now chances are the low at 1250 was just a correction of a larger degree but not "the" correction I was anticipating. It seems like the market will continue to go higher before making a proper Fib retracement from the rally from 1040. When the correction does come, we will probably see a 100+ points move down. But in the meantime, the market will probably retrace to test the TA or even the 1300 level and then launch for new highs for the year. How the market can do this with oil closing at $108 is beyond me. Common sense would tell us that a 30% increase in oil prices in a matter of couple of months will have a big negative impact on a recovering economy. But the market is not about common sense or rational behavior, it's about sentiment and right now most people are feeling pretty bullish so no need to fight the euphoria.. if anything, it's time to join in.
I traded my short positions throughout the day and made a profit from the 1331 lot. However, I lost about 20 points on my short taken as a hedge at 1308. So now I am all cash and waiting for the TA to get tested to enter long positions. I will probably short here and there but obviously, it is a risky strategy given the bullish trend.
Have a Great Weekend!
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