Transports To Bounce

Basically if we have a market that's going to bounce (relief or not), the phrase, "A Rising Tide Lifts All Boats" applies to 2/3 rds of the market. Our Transports (IYT) short that we entered about a point off the all time highs looks like it too will see a decent bounce. Whether I close it to re-open at higher prices and keep the gains we have logged so far is really a matter of trading and opportunity, longer term it won't make any difference in my view.

Here are the charts and how I intend on approaching them..

 This 15 min leading positive in Transports is similar to what we are seeing today market wide and this is a timeframe that's associated with swing trade type moves. We have a base of at least 5-days so it can support a pretty decent move.

The 2 min intraday chart looks like transports should pullback, just as I posted in my last post in numerous other assets. Again the difficulty with only 30 minutes left is to see how strong this intraday divergence becomes. If it is strong enough to create a head fake move which would be a move below the $142.40 area in IYT, that's an ideal entry for long positions like the FAS or XLF calls / URTY or IWM calls. I'd also consider taking gains off the table in some shorts, again I still want the majority of my positions in line with the highest probabilities which means on the short side, but in certain assets in which we have strong gains, I'd consider protecting them and a move to a new head fake low would provide a good area to do that.