FAZ

The idea that this has been a speculative money unwind has been floated here a lot lately. If we follow the pattern of the 2008 unwind, first went energy, then equities, then of course we had the banking crisis. FAZ has been mentioned as a long candidate recently and I think it probably makes just as much sense now as ever.

However, "if" I'm correct that money is going out of commodities, out of equities (and the market darlings that have been leveraged up will be the hardest hit) and into treasuries, then the trade becomes almost anything short or in this case, long an inverse ETF like FAZ which is the leveraged inverse on financials.

 FAZ's price pattern implied target would be around $65, the shorter target would be somewhere in the $49-$50 area.

This is an hourly 3C chart and a pretty strong looking one at that. The trade could be put on here or with confirmation of a breakout of the triangle base around $42.50 or so.

Thus far we've witnessed a very fast change in the markets. I have to slow myself down a bit, while also not missing out on the opportunity. Thus far everything suspected yesterday seems to be coming true today, from the false breakout late yesterday to the idea that not only are commodities being de leveraged, but also equities and the target for the money flow would be into treasuries. When things happen this quick and it seems like you're on the right path, it's easy to get over-zealous and jump in with both feet. We have t remember that the market's specialty is curve balls so while I personally would be making moves right now to get positioned, I'd also take a step back, take a deep breath and remember that if this is a macro trend that is starting to develop, there will be plenty of time and opportunities so don't go betting the ranch, don't forget about risk management and keep your eyes open to al possibilities.