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Wednesday, January 25, 2012

Market Thought... light protection

I have some relatively light protection. Interesting intra-day action.  The market started climbing around 12:20.

The equity rise should have correlated with the treasury 10yr, but it did not. Around 11:30, the 10yr started to collapse.

Seeing this type of action does not inspire confidence, at least to me.

Superficially, the SP500 chart is still very much intact.

I have already expressed my cautiousness, and I am lightly protected (via a light SPY put protection and EUO).

The market could always see a blow-out top, reaching 1340-1350, and any decline should be in the range of 3-5%, but I am patiently waiting.

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