Wednesday, May 4, 2011

5/4 Daily Commentary

I'm currently 4% SDS, 4% QID, 2% TWM, 1% UCPIX, 1% SOPIX.
SPX, Russell, and Nasdaq count as wave iii of (iii) in progress.
The alternate is that a 3-wave down completed today and the bull market continues.  Obviously I think this is a low probability.  However, until critical M/A is broken the odds are 1-3.  The futures need to hold first the DJ 10-minute M/A then the SP 30-minute M/A.  I'll short YM on the return to it's 10-minute M/A, currently 12,705.  Stop 38 points beyond.
The dollar is in wave iv of it's final wave and is poised to decline to final low. 
I sold 1% ZSL at 18 this morning on the expectation that the dollar would break down then.  Instead is returned to the middle of it's rectangle and silver declined.
Gold finished what I count as it's daily chart 4th wave and a nominal new high should coincide with dollar low.  Ordinarily I would expect a triangle as gold's 4th wave, but the dollar looks to bottom quickly.  The risk is that the wave count is wrong and 5 up are complete.

Silver either has completed it's 5 down or will with 1 more low.


I've sold my final 1% ZSL at 19.48 in ARCA after the close.  I'll look for a rally to go short again.

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