Monday, October 13, 2008

What was the trade in the stock market today?

Today's markets showed irrational exuberance. The Dow was up over 936 points. and the Nasdaq was up 195 points. You can't believe all is well with the world in one day, can you? Near the close I bought an ETF Russell Ultra Fund Short. The symbol is TWM. It lost over 26 points or 22% just today. If you think we are at the bottom and have rallied off of it then you should not pay attention to what I am about to say. If you think as I do, we had a Bear Market Rally today and it is just a matter of time before the Doe and other market indexes retest their recent lows.

I like to sell or buy shorts when the market has a day like today. So I bought the ETF for the Russell 2000, symbol TWM. If the market retests the recent lows, I should make about 20% return.

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