The more and more i think about the action, this possible scenario wets my palette. We have cities and states that are defaulting on debt and raising taxes. Unemployment on the rise. Companies blowing out earnings but lowering guidance and giving doubtful projections. So here we go.
The senate is not going to reappoint Ben Bernanke. We are going to have buy the rumor sell the news scenario. I am going to hold my spy puts, UUP, TLT, and VXX. On Friday i purchased some February spy calls, to catch some of the upside we will see next week. During this next move up i am going to ladder some additional TLT, VXX, and SPY April puts.
If we gap down on Monday i will probable sell the remainder of my spy puts. These puts are for march. Then instead of buying more calls and pushing the rally i will patiently wait and nibble on the short side. In addition, if we do rally GOLD should push up hard and the dollar could retrace.
Those are my deep thoughts for the next week.
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