Short Opportunity Of A Lifetime?

Well, it's been two weeks since I gave the two-week notice for the bears to wait.  The rally of 7% in the markets last week went further than I expected above the 50-day moving average.  I think there was some leaking of information on Monday that contributed to the big moves on Monday and the public announcement on Wednesday of the coordinated central bank global dollar liquidity.

However, the S&P did not cross the 200-day moving average (1265) convincingly.  A failure to close above the 200-day signals that there's a strong possibility this is the opportunity that the bears have been looking for!  Last week and today were excellent opportunities to open shorts and buy puts of  >3 months.  As banks and other institutions hedge their bets of a failing euro and eurozone, the cascading dominoes of self-preservation will fall.

If by some miracle, we close convincingly above 1265, we may need to reevaluate.  But for now, this looks like the short opportunity of a lifetime.  Today, the S&P is rumored to put all euro zone countries on negative watch this evening.  And so it begins...  We'll have to see how the markets act this week up until the summit on Friday.  A failure to reach any meaningful agreements with adequate details could spark an ugly Monday next week.  Grab your popcorn.  It will be an interesting week.  Although the Dow closed up 78.41 to 12097.83, the VIX was up 1.16% to 27.84.