"B" WAVE?

Today's price action and breadth was very strong, but we've learned over the last few months that the market moves can sometimes be deceptive. Many individual stocks that I have looked at appear to be in a "B" wave. "B" waves are often referred to as suckers rallies. We will likely open higher tomorrow...and maybe even move higher...but we could still get more of those wild swings I talked about on Monday. Technology stocks have started to fade a bit. NFLX had a very bearish day. GOOG has been dropping fast. AMZN's price action was fairly bearish today as well. The financial stocks have also failed to significantly participate in the rally. Gold looks like it is in a classic "B" wave. This market really shouldn't be rallying. The only reason it keeps going up is because the Fed wants it to. This is why the last few months have been maddening. My advice is to not hold positions very long. Try to take profits early. I exited most of my bullish trades at the end of the market today. I held on to a few contracts in case we open higher, but I will be quick to take those profits as well. For a pure speculative trade, I like puts on BAC. The rumor out there is that WikiLeaks might have documents that show that Bank of America is in worse condition than we originally thought. WikiLeaks didn't mention Bank of America by name, but they did say "a major financial institution"...and last year they did say that they had obtained documents off of a Bank of America executive's computer. Bank of America has been in the news over the last few years for not only their exposure to mortgage backed securities, but also the recent foreclosure mess. I stated in a blog entry back in 2009 that I felt that the banks were in much worse condition than we have been told. I still feel that way. I have often compared the governments handling of the financial crisis to the story of Enron...except when the government does it, it's legal. As much as I hate WikiLeaks, they have often been right when they've said that they have damaging evidence. Whether it ends up being Bank of America or not, that type of negative news would likely cause a major sell off in all the banks. I personally like a put option trade on BAC simply because the trend is already down...and seems to want to go lower. Let me be clear though...this would not really be a trade. It would be more like a gamble. A gamble that there could be some really negative news leaked soon. This would purely be a speculative trade and one should never put large amounts of their trading capital in such a position. I like calls on CSX, IBM, and BIDU (if it can close above its 10 day MA). I won't recommend any puts yet, but I did say that I'm seeing a lot of "B" waves out there. GLD and FCX might be at the top of the list if this market starts to turn down again.