The Bulls Charge back with Fury. Who will win? We don't know, What we can say for sure is the Volatiltiy is Back.

The Fight continues between the Bulls and the Bears. With The Market still officially in "Bear" Territory. No winner has been declared yet, but we know for sure the Volatility is back. If you take a look at 2 day chart on any broad index, it looks like a letter V. Down all day yesterday, then back up just as fast. The Volatility is back. The S&P Ripped up 28 points, The Dow popped 263 points, and The Nasdaq soared 55 points. Erasing Yesterdays losses and putting the Averages into the Black for the Week.


I did not have any open trades coming into today, nor did I put on any new trades. I did missed the opportunity to get long the Financials early in the day, so I just sat on my hands. The shoulda, coulda, woulda's can't get to me any longer, because I know they always end with the words "But you Didn't". With my Trading Philosophy I do not enter the markets unless I have a conviction. I missed the boat today, and it is tempting to cry on the shore. I would rather preserve my capital that try to jump in chasing every market move. You can't get them all.

The Markets rallied strongly on the back of Merrill Lynch raising 8.55 Billion Dollars as CEO John Thain unloaded a batch of money losing CDO's. we are seeing some signs that people are buying up the once unsalable CDO's. This is huge. As you have known I have been Bearish on the Markets for a long time (Since October 2007). While I have traded many bounces long, I still maintained a strict short bias. Now I am forced to reexamine my outlook. Commodities are clearly breaking down, the dollar is rallying, and stocks as an asset class look more attractive. The Hedge Fund King John Paulson who made $3.7 Billion Dollars in 2007 with his bets against the CDO's is starting up a new fund to offer capital to some of these distressed financial companies. If Paulson is covering his short bets and fishing around to get long by offering up money to the very industry he made a fortune betting against, any intelligent investor must take notice.

The US Dollar gained about 2 cents or 200 pips against the Euro. Oil Prices shed over $3 Dollars a Barrel to around $122.5 in the Floor Trading Session.

In M&A activity Teck Comico agreed to acquire Fording Canadian Coal for $14.1 Billion dollars. Coal Prices have doubled in the past year and many companies are out shopping to pick up coals on the lows.

After tomorrow the SEC's Temporary Ban and enhanced enforcement of Naked Short Selling is removed. It is going to be interesting to see how markets react. Happy Trading.