Solid

5pm Solid. That is what I would call the market's action today. We had a lot of things that could have sent the market dramatically lower. We had a dismal ADP report. We had a weak beige book report. We had FCX saying that business was so bad that they cannot commit to their dividend anymore. Even with all of that, the market went higher.

What does this mean? It means that there are some constructive psychological underpinnings going on in the market. That is all I can say at this point. It does not mean that there isn't another 700 point down day coming soon. It doesn't mean that the Dow goes to 12,000 in 2 months. What it does mean is that the expectations - emotional and statistical - have been lowered enough that even Great Depression-like numbers are not going to phase the market much.

How do I make money with this knowledge? I got rid of the majority of my short positions today. I haven't gotten ridiculously long, because there will still be some down days coming. What I have done is took some profits and I have a very cash heavy portfolio now. I am looking at a long position in some index funds but I haven't gotten really long yet.

Hang tight if you are really long in your portfolio. Look to add some longs with some more constructive action. Until next time, stay low risk..