The Local's Take: Mid-Day Commentary

Good afternoon,

I give the stock market really good odds to finish green today.

Actually, I did something very unusual - I held overnight in my forex account and stayed long the dollar. Yes, it is against my rules, but the risk reward was there as commodities which have been so strong started to hold resistance and thus the currencies related to them (AUD/NZD/CAD) acted weak.

I shorted the CAD and AUD and stayed with it overnight, taking most off late last evening. Had I held it, well you know how it goes: "I caught a fish this big!!!).

In addition I caught one BUFFALO BOUNCE in the AUD/USD:
So we have some suspected crooks on Wall Street, who would of thunk. Regardless, I am not sure this is the end of the uptrend, but I did put on a lot more protection today using the highs in the broad indexes as exits to avoid assignments on any bear calls.

Check out a double top on USO:


Overall, the markets could/can sell off worse but there still seems to be the underlying bid, so protection that risks assignment has tight stops and longer term protection (put buying) has catastrophic upside stops in place.

Oh yeah and by the way, next week we have:

• Bernanke on Monday
• Claims on Thursday
• Durables on Friday

I have plans to wash the winter off of my car. Hopefully you have a more exciting weekend than that!

Local's Tip: Pato Banton at the Spur Bar and Grill Fri and Sat

Be Environmentally Cool with Locals Have More Fun apparel