The Basic Question

In different forms, I'm getting a lot, LOT of emails asking about the market. As for the near term, the charts suggest a pullback, some backing and filling and we can see that forming up in all the averages, but I'll just use ES for now.

 ES intraday going negative, from what is visible now (not trying to predict the weekend), it looks like some backing and filling is in order.

As for our sub-intermediate expectations, so far everything has gone the way we expected, the head fakes in the yellow boxes, just about everything and we've had to trade nimbly. The one thing that hasn't happened is a short squeeze in the EUR/USD and market. Both are in the area that could produce a short squeeze and over the weekend we could get some news that easily trumps the short term 3C negative divergences suggesting a pullback from here and then it would be off to the moon.

Our risk asset layout is still supportive of the market, most of the 3C longer term charts are still supportive of a final short squeeze move, although some damage has been done.

The way I see it, short term trades like the GLD trade, etc that were leveraged, I want to close out, they made their money. The leveraged long hedges that were bought at the market lows as a hedge for the core short positions, I want to leave in place and of course the core short positions which are ALL at a profit still, I want to leave in place.

That's how I have set up things and I think many of you have done the same. So very short term trades, I want to take profits off the table. The sub-intermediate leveraged longs that were to act as hedges for the primary trend, core shorts, I want to leave in place and the core shorts I want to leave in place.

I realize there are many individual stocks and trades, this is just a general assessment. For instance, I'm leaving the BIDU long in place even though it was meant to be a shorter term trade. There are some exceptions, but for the most part that's how I view things at this point.

If the Euro can hold up and make new highs above the June highs, we may finally get the short squeeze I have been looking for before we see the next primary trend leg down.