I use I1 and the XMI as my "deep throats". Down beneath the smoke and mirrors that roil the stock market these informants whisper in my ear what the big money is doing. "Follow the money" has always been my motto. Well, the money is flowing out of blue chips under the covers. The Nasdaq launched a rally based on Cisco that dragged the rest of the market along, except for the XMI. This is the tell. In prior post I produced an S&P chart that showed 2 ABC upward moves today with the second one completed at 1145.22. The following is the real tell, the XMI:
Regardless of what the market does the rest of the session, if the XMI does not materially exceed its old high then the top is in.
Selling QID at the open today turned out to be a great move. That meant that the SDS full position and SKF 1/4 position were the only exposure to the rally. Silver 1/2 position is back to 4.23, what I paid for it. Short stock positions were added on after 10:56.
Update: 2:24 Nasdaq shows potential for 1 more high. Will not short it, but stand pat as long as XMI does not follow to new high.
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