"And, Nostradamus Shall Lead 'em....."
As Uncle Ben & Co. pre-empted the BLS' Feb NFP Release early this morning, much to the liking of GW, Dick Cheney and the rest of the usual suspects on both ends of the Pennsylvania Ave. in Washington, it was a different story on Wall Street. The Smart Money sold, and sold relentlessly. And, as the Mortgage Mess CEOs showed up to defend their 8-digits pay packages on the Hill, the fall in share prices steepened.
Pre-open we had warned that today could be a negative 300 day on the Dow. Well, we closed half as much on normal volume. This tells us the bleeding should continue as VIX, VXO and VXN patterns have not reached an climatic structure from a sigma channels standpoint.
Could we see that pattern completed next week? We don't think so. Not so fast at least.
But....the following week is March Options X featuring FOMC Meeting on Tuesday, March 18th and Quadruple Witching Expiration on Thursday, March 2oth. Good Friday, March 21st, falls on the Spring Equinox (often an inflection point). And, indeed, this Spring, could be a time for renewal on Wall Street and the Main Street. But first, we do need to go thru a FLUSH of the weak longs by then.
Have a great weekend ...... STAY SHORT a little bit longer!!