Shorts Get Creamed

Well that was a just about the most visciour short squeezes I have ever seen. The shorts really got the horns of the bull head on today, lol. In the last two hours of the day the SPX literally went from 860 to 940..thats 80 handles in the broadest market measure out there. The market was also down big in the morning and after making a double bottom from previous lows, the market never looked back. I took a long in the futures after we consolidated out of a nice bull flag around 215 pm et and shortly before the market busted thru resistance at 875. These are the high probability setups you must take advantage of in this market. If the market decide on a direction and then proceed to slowly consolidate into a flag pattern you gotta take the trade on that breakout because the market is telling you it is resuming the trend. But I did not see the rally catching such thrombolic speed and so I took my profits a bit early, lol, I'm sort of famous for that actually :)

This is a market where it pays to not hold overnight (or be completely hedged if you must). If you understand how to interpret what the charts are saying intraday this is the perfect for trading the futures and while the "Buy and hold" folks get whipsawed, the traders are making a fortune.

Anything can happen tomorrow and that should go without saying, with the Fed interest rate decision being announced at 2:15 et. The only thing I know for sure is that the day's action should be choppy and violent especially the closer we get to 2:15 pm et. Don't expect anything. Scalps would be my preferred method of trading the futures tomorrow and just remember we jumped 900 pts in the Dow so asking for more would be selfish. Not saying that we give this whole rally up either because I believe todays move felt different versus past rallies. There was something about the rally today that got me thinking "cautiously bullish". The up volume in the futures was incredibly bullish and you cannot just ignore something like that. I wonder if Uncle Sam was in there buying the futures? hmmm...