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Monday, September 29, 2014

Step 1: reach into ass. Step 2: extract a possible downside target.


HYG weekly:


This chart helps you keep everything in perspective, trendwise.

But it also suggests that a decline to say $3 below the SMA(50), say $88.50, is a fully reasonable downside target. Happened June 2013, no big.

Similarly,


the last big pop in Q was early 2012, which was followed by a descent towards the weekly SMA(50), which on this chart would be maybe $91 or so.

Dunno if what we're seeing today is Pimco liquidating tens of billions, or people selling in anticipation of Pimco liquidating tens of billions, or simply everyone saying "hey, people are selling, let's do that too."

I'm mostly cashed up, but still excited at the possibility of a real (10%) correction that I can short volatility at the end of.



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