On hindsight I feel good that I did not pull the trigger on the oil sector when it went bullish 3 trading days back. I mentioned at the time that I felt nervous and fearful pulling the trigger. Although that should not happen and I should have got in either using ERX or UCO, my gut feel was good. Yesterday oil gave up almost all its gains of the last few days.
So, I have decided to stay away from trading Oil for the time being. It is just too volatile.
I am still long the VIX calls and yesterday VIX moved up a bit with the market being down. That did not do much to my calls as they are far out of the money and I am really using them as a hedge.
Let us see how the overall markets are doing:
SPY: holding it’s own and staying above the 10 day moving average and all other moving averages; so despite all odds looking bullish
EEM: has fallen 1.9% in the last 2 days and trended below the 10-day moving average; so still bullish but cannot be sure
IWM: bullish and looking good; it went up on a slightly down day yesterday
XLF: a little sketchy but staying bullish
XLK: staying bullish or neutral; nothing to do
XLU: definitely bearish; this is why I am not confident about the market even though most of the indicators look bullish; there is an undercurrent of fear in the market
XLE: topsy turvey and unreliable
XLI: staying above water
GLD: mildly bullish; not worth taking a risk
SLV: definitely gone bearish
USO: already discussed