The Cisco Disco

Take your baby by the hand
And make her do a high hand stand
Take your baby by the heel
And do the next thing that you feel
--Wang Chun

After being up a percent then down more than a percent in the premarket, futes turned around and went green, thereby facilitating a gap higher at the open. The indexes pretty much never looked back and once again we saw a 5%ish range. Close: Dow +423.

I believe that makes 5 consecutive days where major indexes have ranged 5% or more.

Lots of folks suggesting that yesterday's melt constituted a successful retest of Monday's low--meaning that the worst of the selling is past.

Perhaps. My sense is that there is big leverage that wants to leave the system. As such, I want to sell rallies.

Consistent w/ yesterday's plan, I nibbled in some SPX short into today's rally. Also but a little SLV.

The big gainer today was Cisco (CSCO) that bolted about 15% higher on a better than expected earnings report.

While other stocks have been retracing some of their gains off the 2009 lows, CSCO has made a round trip. With the selling earlier this week, CSCO has basically given it all back during its recent decline.

Now, with today's big move, it appears that CSCO may have put in a classic double bottom. As always with technical analysis, it will look 'obvious' with hindsight.

position in CSCO, SPX, SLV