Rally Ruins JJC's Plans

Why don't we just ratchet up the odds here of a crummy day tomorrow? This rally is stealing from what we hoped to get out of tomorrow's 50-basis-point move. Now it makes it likely that we will have to take profits on some trades today. We are exiting some of the financials that we just picked up 5 and 7 points on. Those will be too hard tomorrow.

It is nasty that they are rallying them so hard. It drives us batty when they run like this, because much of it is short-covering. If you are confused, please go over the 1994 series where I describe what happens in these rallies around Fed-fund boosts. Shorts simply panic, just like longs do when things go down, and they exaggerate the gains. That's your cue to exit stage right.

We are taking it.

Random musings: Department of Irony: We are short Terra Networks(TRRA Quote) and warming up to Terra Industries (TRA Quote) -- the fertilizer company!