Oil prices and the US Oil Fund ETF (USO) leapt 4% off of Friday’s low in sympathy… Read More

Oil prices and the US Oil Fund ETF (USO) leapt 4% off of Friday’s low in sympathy…

<p>I updated the indicators here:&nbsp;
http://bloomblog.spaces.live.com/default.aspx.&nbsp; It’s worth a read as indicators
provide objectivity, a good alternative to panic.</p><p >A few superlatives:&nbsp; VIX is
up 86% this week, 146% in the last two.&nbsp; This represents unprecedented sharp
movement from extreme complacency to panic.&nbsp; It’s time to buy when blood is
running in the streets (of Athens, literally).</p>
<p >EWP, the Spanish ETF, lost 15.7% this week, 24.02% in the last 4.&nbsp; Many
other European countries and even Russia were similarly crushed this week.</p><p >Market breadth has declined more than all post-crash pullbacks, settling
at 15.&nbsp; March 09 and Oct 08 went lower.&nbsp; The market is extremely oversold and
likely to bounce.</p>
<p >SPX fell 6.39% this week, compared to last week's 2.5% decline.</p>
<p >SPY volume Thursday and Friday of this week exceeded all 2009 and 2010
levels.&nbsp; The crash of 2008 had comparable levels.&nbsp; Bounces have always occurred
after SPY volumes this high, but in 2008 were not very long or strong, while in
2009 and 2010, they tend to catalyze long rallies.</p>
<p >I remain bullish and the market is very tradable from the long side at
these levels.&nbsp; However most ETFs have dropped below their 200 day moving
averages.&nbsp; That makes then primed to trade from the short side.&nbsp; Shorting
European and commodity ETFs could be a good hedge for long exposure on USA.&nbsp; A
market bounce is needed though, a significant one, to initiate short exposures,
and then only on the ETFs too weak to move back above their 200 day moving
averages.&nbsp; Shorting immediately into a likely bounce is not recommended.</p> Published By Bloominonion Saturday, May 08, 2010

<p>I updated the indicators here:&nbsp;
http://bloomblog.spaces.live.com/default.aspx.&nbsp; It’s worth a read as indicators
provide objectivity, a good alternative to panic.</p><p >A few superlatives:&nbsp; VIX is
up 86% this week, 146% in the last two.&nbsp; This represents unprecedented sharp
movement from extreme complacency to panic.&nbsp; It’s time to buy when blood is
running in the streets (of Athens, literally).</p>
<p >EWP, the Spanish ETF, lost 15.7% this week, 24.02% in the last 4.&nbsp; Many
other European countries and even Russia were similarly crushed this week.</p><p >Market breadth has declined more than all post-crash pullbacks, settling
at 15.&nbsp; March 09 and Oct 08 went lower.&nbsp; The market is extremely oversold and
likely to bounce.</p>
<p >SPX fell 6.39% this week, compared to last week's 2.5% decline.</p>
<p >SPY volume Thursday and Friday of this week exceeded all 2009 and 2010
levels.&nbsp; The crash of 2008 had comparable levels.&nbsp; Bounces have always occurred
after SPY volumes this high, but in 2008 were not very long or strong, while in
2009 and 2010, they tend to catalyze long rallies.</p>
<p >I remain bullish and the market is very tradable from the long side at
these levels.&nbsp; However most ETFs have dropped below their 200 day moving
averages.&nbsp; That makes then primed to trade from the short side.&nbsp; Shorting
European and commodity ETFs could be a good hedge for long exposure on USA.&nbsp; A
market bounce is needed though, a significant one, to initiate short exposures,
and then only on the ETFs too weak to move back above their 200 day moving
averages.&nbsp; Shorting immediately into a likely bounce is not recommended.</p> Published By Bloominonion Saturday, May 08, 2010 Read More

After the Continental Airlines, Inc. merger announcement with UAL Corporation (NASDAQ: UAUA) , something interesting happened in the sector.  Suddenly the valuations seemed too high.  Then the shares started selling off, then the bloodbath in the market only made things worse.  We took a look at the ETF called the Claymore/NYSE Arca Airline (NYSE: FAA) [...]

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