TGIF and More

Big reversal yesterday - the S&P closed green after touching 1370 intraday. Volume was very high. Trend reversals have often occurred with similar patterns in price and volume. The real buyers likely scooped up stock at the 10% correction level, and the virtual shorts covered when the selling momentum dried up.

So that's a new "Day 1" in a prospective rally count. We need a big up day after Day 4 on higher volume to confirm the rally.

BAC is setting up a small H&S bottom pattern - needs a couple closes over 50.2. C and JPM bounced strongly, as did MS. Afterhours, HPQ had strong earnings and raised guidance.

In yesterday's comments, I mentioned a small silver buy and a CSCO add.

I didn't pull the trigger on buy#2 per yesterday's "time diversification" posting since the market was recovering and I figured I wouldn't get a price close to S&P 1370 at the close. That proved correct. So I'm still waiting.

Japan markets were crushed overnight - probably beefers reacting to the yen craziness, or locals getting margin calls.

PS: Fed cuts discount rate 50 bps to permit funding of ANY mortgage collateral. Very early pre-market reversed huge from down big in early futs to up huge. Beefer shorts are being grilled.

PPS: I might pull the trigger on my buy #2 on any day with a dip, since the Fed seems friendlier now and not "completely" wrong-headed. Yes, I let policy changes & long-term thinking affect my tactics, as any long term investor should.