Prognostications for the First Two Weeks of NOV13

1. The market should trade down to shake loose some coconuts prior to options expiry next week.  Looking at my chart, the SPX tends to trade down to or up to a relative extreme at options expiry.

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2. Charles Kirk published a MarketSci chart in his magazine that shows that November has seasonable up days at the beginning of this week. I would take this seriously. Why? Because I still believe in the max pain theory. A couple of up days this week will draw in more weak hands for a flush out over the next 10 days into expiry.

3. I think we’re in the irrational phase of a bull market. But there will still be pullbacks.

4. I think we see 1700 in SPX before 1800. If we broke 1800 without retracing 1700, the irrational is upon us without remorse.

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Tsagaglalal – (She Who Watches) See, Naked Against the Rain

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