The Daily Dose of Trading Comments

I write late tonight as I've been trading the futures a bit this evening. Oil is up some 6% in the late trading and the equity futures are sucking air. I've been buying equity weakness for scalp trades and shorting oil with the same idea on surges around the $70 mark. As tomorrow draws near, my study of the charts this weekend had me thinking that the next bounce is likely to come in around the 200 day moving averages and with tonights depressed futures, that target could be reached in the morning. If oil holds these prices (Katrina isn't expected to hit until early morning and damage not quite accessible until a bit later), then the early morning trade might be to fade the weakness for a bounce and, of course, short the oils on strength. My expectation is the oil surge will be the exhaustion gap for this intermediate term leg up. For the equities, the spike down that cleans things out and provides the argument to buy. We have been winding the rubber band of late and a sharp sell off could easily reverse if price holds around those 200 day moving averages and result in a sharp rebound.

Enough for tonight. We'll take a look at this puppy in the morning.