I guess a lot of people are thinking that the market is going to drop hard next week. But I believe that it could not happen without a short term bounce. The market is quite oversold and the first day of October is historically bullish. There are only 193 stocks up 25 percent quarterly, and 2097 stocks down 25 percent quarterly, which is considered to be extreme. I feel we need to have one to three days bounce to relieve the oversold, then do further down. We could see bounce as early as Monday morning. Note that On Saturday, the Chinese PMI number is released. The number is better than expected, which indicates China is still growing. It can be an impetus for a bounce.
I have repurchased some SPXU position on Friday, which I sold on Thursday close to reduce my risk exposure. I closed all my SPXU position after market.
Actually I am not too bearish for October. If spx could retest 1100, or go down touching 1090 zone, the market can have a huge reflex bounce. Do not underestimate the power of the bull. We are seeing consistent buying when spx gets to 1120 area for a couple of times.
I will long the market if it is closed in green on Monday. Let us see.
1010 is not so easy to be reached. 2011 is not 2008.
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