I don’t think I want to see the number 3800 again in my life, unless we’re ultimately talking about it as resistance. This Fibonacci level has served as an iron-clad wall for weeks on end, and Friday was no different. We got our jobs report, rallied, burned off the entire rally in less than an hour, and then went skyrocketing the rest of the day. Had I not planted my bearish bottom in an airplane seat fifteen minutes before the closing bell, we would have ended at the day’s high.

Thus, we’re still banging around the same annoying range we’ve been in since time began. This is not to suggest I am unconcerned. I did trim back to 16% cash on Friday, and I’m not thrilled with how strong the volume was. I will say, however, that with a VIX being crammed down to 20 once again, I remain comfortable in my multi-month long put positions. I can only hope that the dividing line on the /ES holds fast.

At the moment, the Fibonacci is acting as an extremely powerful magnet until such time as a meaningful event occurs to unlatch it from this fixation. Maybe it’ll be the CPI on Thursday morning. Maybe it’ll be when earnings come roaring in later this month. As for now, this is just a grind. Up one day. Down the next. Repeat.

I would suppose I’d say my principal concern is that the powerful downward thrusts of early 2022 have vanished, and instead we’ve hammered out a higher low instead of a lower low. So not only has the downtrend become far more muted late in 2022, but at the moment we’re looking at a trend change. Obviously I’m counting on this to be an ephemeral state of affairs.

As with most bears, Friday was not a good day for me. I did get the classic reversal signal of a guy throwing his arms up in disgust, cancelling his account, and saying shorting stock isn’t worth it. I disagree. I think shorting stocks is the most fun you can have with your clothes on. It’s just that days like Friday tend to separate the bears from the cubs.

I remain in a total of 25 bearish positions and look forward to next week.

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