Which Way Do We Go?

We started off the day down a decent amount, sold off a bit more then stabilized and rallied. By the end of the day we were back at guess where...850. Obviously, typical technical analysis says this should serve as resistance now that we are coming from the underside. The day was slightly confusing because it did show that buyers are still active, and many of the names I wanted to buy into would have been great buys right at the open, however we didn't have enough conviction to break back above. Bank stocks started off with significant losses and ended up fairly positive on the day, again a bullish sign but less convincing as most of the news is already out to propel stocks higher.

We have MS on tap tomorrow and better than expected earnings could prop the market a bit depending on guidance. It has held up very well so far, if there is some bad news though it could give up its trendline in a hurry. I pulled my hedge off near the lows of the day as we stabilized then put it back on towards the end but slightly early because I am sitting with a decent loss right now, but the futures are down nearly 1% so it could still be a smart move.

Another catalyst in some direction could be FCX, it reports tomorrow and could determine the fate of my PCU position as to whether or not I sell or hold. Copper prices tested 2.00 today and rebounded, which is positive but the stocks have had a good run and without real demand it could be hard to keep it up. Shippers did well today and again I missed the opportunity to buy at support before they shot up, luckily I still have my reduced position size on but would have liked to have a full position.

Tech will be in focus for AAPL and AMZN and I get the feeling they won't do much to the upside and likely pull back on announcement considering the run they have had so far but you never know. I have considered selling some strangles but with so much time to expiration I don't know if that is a smart choice. A more extended pull back in tech and most of the financial earnings digested could be a reason for a deeper pull back in the S&P to near the 800 level. This is an annoying time when the market lacks direction and we wait for the next catalyst to move us higer or lower.

I was having a decent day till the end when my hedge ate up most of my profits but I still eeked out a gain. Getting out then back into my hedge did save money though.

Total Return for 2009: 127%