I already stuck me neck out calling a bottom so now we’re just waiting patiently.

We are below the levels I hoped we would hold on Friday:  Dow 10,020, S&P 1,070, Nas 2,220, NYSE 6,666, RUT 641 so we’ll be looking to see if we can retake those as a start today.  Contrary to popular opinion in the MSM, the World did not end over the weekend and, as I said in this weekend’s special commentary: “The Worst-Case Scenario” anything short of that won’t keep us from buying down here, using our hedged entries.  I’ve already put up 13 of my top 20 long-term trades in our new Buy List(Members Only) and I should have the rest up tonight. 

We’re not expecting the markets to get away from us this morning but, as you can see from our Friday’s trade ideas in the Weekend Wrap-Up, we took 7 new bullish positions into the sell-off .  We expect at least a short-covering bounce this morning as the super-bears sober up a little and perhaps rethink those S&P 800 puts or whatever it is super-bears bet on when they get into a frenzy like Friday. 

It’s all about the Euro today as they are below that $1.20 mark and fell as low as $1.1876 in overnight trading and that’s boosting the dollar and killing commodities (other than gold, which people are still panicking into), which is driving down commodity stocks and pushing down the markets but, as I said to Members on Friday afternoon:

  Keep in mind that your stocks are going down because they are priced in dollars and the dollar is up 1.5% today – we are very close to where we were in the Nov ‘08 and March ‘09 crashes on the dollar (89ish) yet, as Tusca points out, our markets are 70% higher than they were at the time.  If the dollar devalues now – our markets will rocket and that’s all the G20 has to accomplish and it’s a win-win for everyone – save the Euro, boost US equities.

We were disappointed that there was no major announcement out of the G20 this weekend but the real meeting is at the end of the month (this was just the Finance Ministers), so plenty of time for something to happen.  Before we go getting all bullish his morning, let’s talk about what constitutes a recovery and what constitutes a weak bounce in our indexes:

 

 

IN PROGRESS