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Stocks racked up their worst loss in two weeks, dashing hopes that the market was busting out of the trading range where it has been stuck for two months.
Weighed down in part by new worries about Europe, the Dow Jones industrial average slid 247.49 points, or 2.1%, to close at 11,397.00 on Monday.
That took back about half of the Dow’s 541-point, 4.9% rally last week.
It was a nasty sell off for sure today. The market got nervous because of some hawkish rhetoric out of Europe. Europe is a continuing saga that seems to never find closure and many were unprepared for the surprise sell off.
We were prepared though, as we reduced our long exposure into the rally on Friday. As I like to say, “feed the ducks when they are quacking”. They quacked a lot on Friday. We also got long FAZ on Friday which got us short the financials, which had a very bad day today.
I sold the balance of MELA today and took another 1/4 AAPL off the table in case you are following the P&L. I also sold NSR early for a small .20 cent loos. The market was selling off and I didn’t want to be long so I sold it. You guys received a email to that effect.
Tomorrow will be interesting and we will find out if the bulls have a “turnaround Tuesday” up their sleeve. One day does not a trend change make, but another big sell off and it may mean that the momentum will have shifted back to the bears.
IBM disappointed the street after the close and the stock was down about 8% in the after market. CROX also preannounced their earnings and the stock is down 35% in after market trading.
Tomorrow morning we will see results from BAC and GS, which could either put a bid under the financials or crush them further.
Hope you all had a good day and I will see you in the morning. The P&L has been updated so please check it out so you know where we are.