I did not like that!
Intel got us off to an awful start and oil raised its ugly head back over $52, breaking my $52.10 danger zone on a huge end-of-day pump that had crude finishing $1.64 above its low of $50.60.
- Dow was fairly well behaved, testing and failing at 12,600. We had a bounce from BA and XOM and an all-time high for PG on a Goldman upgrade but, other than that, it was a lackluster day for the Dow, which dropped 5 points in the end to 12,577.
- Transports gave back 31 points and failed all the way to 2,776.
- S&P was dead flat for the day with dead being the operative word.
- NYSE could not hold 9,150 but finished up slightly at 9,146.
- The Nasdaq ruined the party with an 18-point drop to 2,480, just off our failure line and looking like only the end of trading saved them from worse.
- As usual, blame the SOX, which march ever downward, now at 472.
- Russell had no party either, very disappointing as it dropped to 788.
When we tested my week’s target for oil at $50.79 on Tuesday, at 1:39 I said: "We’re just over my mark of $50.79 so be careful with oil short oil plays here!" Just a half hour later I said: "Really, really this is a good time to take oil off the table!!!!"
We dumped all but our long oil puts but first thing Wednesday morning I amended it and warned: "Valero rule says get out! There will almost certainly be pain if you hold so only do so if you like it!"
Zman opened his new section on our site (we are testing this week but this is going to be a huge addition!) with the comment: "Exculpatory Clause To Today’s Generally Bearish Comments: Watch out for a potentially large bounce off $50.00.!!! If we don’t knife through it the bounce could be very painful so watch your puts. " And we’re not the types that need to be warned twice, yet alone 4 times!