The past week was a long hoped and unexpected strong counter-trend rally. The majors recovered over 18%, except the small-cap was lagging at 15%. The market was very emotional. It played the typical of "buy on the rumor and sell on the news". The gap up on Tuesday was in anticipation of the $2 trillion rescue package. The 1000%, over 3 million unemployment claims on Thursday produced more than 4% gains while the passage of the 2 trillion dollar package produced more than 3% losses in the last 30 min before the market closing. I guess the market saw no more good news near term and was nervous over the weekend.
My net liq closed at 84K, upped 20K from last week due to the rally. The rally helped me to exit some of my long holdings, like HD, INTC, and IRAs. My main concerns are still on my long put options.
I will try to flip at least one long put in SPX and RUT next week. I will continue to exit my long term holdings to raise my cash levels. This downturn looks like a bad beginning rather than the end.
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