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    Dangerous divergences developing

    Posted by zach06 on 10th of Aug 2012 at 08:52 pm

    Can you really see anything your really want to own?     Sox has been up  6 days in a row which helps and Transports actually reversed course today.     I don't know how fuel prices are helping,  considering  they will go up more especially if they back off on the ethanol mandates in gas.      It looks to me like classic rotation this week.      The Rut still has not broke the   810 ish trendline.     I think that this market is more of a case of lack of sellers then anything.     Almost  90 percent of the calls I  make on business...  nobody answers.. everyone is on vacation.     Anyway  ,  puts are cheap.    Go long the market and buy protection.     Depending on the size of your account... you can sell some   SPX   1455/1465  Sept  calls for  around  1.65   and buy some  SPY  Sept  put spreads  140/135  are about  1.44       Just exit your longs and keep your puts if the market reverses.      

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