Five Days of S1 - May 23, 2007
We hit our fifth day of S1 readings. Historically, this is a pretty long string, and the market is likely to exhaust itself.
I was waiting for a re-test of the highs to put out shorts. I chose to sell the June 1560 calls 3xs for 4.70, vs buying June 1495 puts 2xs for 6.25. I got a bad price on the skew 8.2% vs 13%. The market is really keeping the puts bid.
The market looks very strong on the back of buyout news on Alcan and stronger retail earnings by Target.
The market looks BULLET PROOF. Yes, I am not feeling too good about this trade right now. And I may have to take some pain on it.
If the market closes at the high today, I'll have to take a sentiment reading and reassess.
But I like the trade. I just wish RSI was higher.
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