MARKET IS CONTINUING THE STRONG RALLY

The markets have continued the strong rally that they have been in over the last few weeks. I haven't seen any strong sign of weakness, but we are nearing some very important resistance areas. Many of you have asked if this is the start of a new bull market. I don't see any strong evidence of that...aside from a month long rally. In context this still looks like a correction within the downtrend. Even if I change from being longer term bearish to longer term bullish, I would still want to see a retracement in the market before I made any aggressive bullish trades. I have a couple of small bullish trades on the SPY and DIA made last week when I noticed an inverse head and shoulders chart pattern on the DIA. Other than that, I am mostly in cash right now...aside from a couple of option spread trades on GOOG and WYNN. I'm content to sit on the sidelines until I see some good trading opportunities. I don't like to trade earning announcements. They are too much of a gamble. I might trade them using a Straddle or Strangle, but I haven't seen many set ups that I really like. I've had a few emails on the FAZ. I don't recommend getting into the FAZ until the market starts to show more weakness. After taking a hit on FAZ last week, I'll be looking for more confirmation on the next entry.