Look at the chart from Jesse and you will see what and why I was selling into.  This is still a good tactical place to be shorting but for sure there are a number of hedge funds that sold short at much much lower levels who have yet to cover and they could propel the market higher.  At this point we may well have set a bottom for the stock market and if we are lucky enough to see a dip it may be time to buy for a ho.
Shortly after China took Hong Kong back from the Brits they had a big sell off and if my memory is correct ( this was a long time ago) at around 7,500 on the Hang Seng the Chinese government came in and bought everything.  A few months later they were able to unload their position at a huge profit.  This may well be the template the central banks are using.  If so we might see a repeat of 2009 when most of the "trade" missed the rally as the fundamentals conflicted with the FED buying stocks to make everuone's 401 Ks look a little better.

Leave a Reply.