We might get a continued bounce here but this is not a market to trade right now.

Germany is due to make an announcement.  The expectation is that they cannot agree with France on their rescue plan for Europe so the market is treading water and looking for bad news.  I have no positions at the moment after covering short positions this morning.  The market can break either way from here.  If it moves up it might signal a significant break on the upside.

I am not seeing huge selling volumes and financial stocks do not seem to be leading the drop so I have sold all my ZSL and TZA and reduced EUO.

I sold some ZSL as well.  These are small profits but Gold is holding up well and I think Governments have to make a stand here or they lose control - which they will in the end but perhaps not now.  I have a small position running in both TZA and ZSL and a full position on EUO.  We will see how the markets behave today - there has been so much bad news out of Europe

I am taking a few profits here

http://delong.typepad.com/sdj/2011/10/what-needs-to-happen-for-the-fed-to-successfully-target-the-level-of-nominal-gdp.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+BradDelongsSemi-dailyJournal+(Brad+DeLong's+Semi-Daily+Journal)&utm_content=Google+Reader

The market went down today.  Do not be surprised if it goes back up on more rumours.  In a nutshell the Dow went up 180 yesterday ( Europe bailout)  and down 70 today ( Europe NOT bailout) on basically the same rumour mongering.  My feeling is that any surprises are more likely to be bearish than bullish so I am still positioned in TZA, EUO & ZSL.  Monday could be a bad day for the markets if they find the Europe is all BS over the weekend.

The market rallied strongly today - a little more strongly than I expected.  We are back into the top of the range and there might well be a further attempt to move upwards.  I am staying with my short positions as this is a calculated play and if it works it works, if it doesn't it doesn't.  People make mistakes by holding a position for too long but they also make the mistake of getting out too soon so I try to hold to a game plan until the facts on ground change - which they have not.... the European rescue plan is a bunch of BS.  Moves today by BofA to transfer their derivative trading accounts from the holding company to the deposit holding company supposedly at the FEDS insistance goes to show that our government still cares more about their friends on wall street than the public.