90% upside day

Recap & stance:
We were expecting a bounce alright, but 500 pt was no where in the range. Eitherways, we expect a low into March 27th timeframe. The bottom is probably in.

Positions:
We covered our CVX short, as mentioned in the post last friday. Today, we did not trade much, since the rally came out of left field and there was a lot of emotion in the market. Our long term positions in oil companies (COP, BP) did well. We also opened a small precious metals short positions today. We believe silver and gold (the fear trade) may subside over the coming months. We are looking at 25-30% declines in these precious metals.

Sentiment wise, today was a bloodbath for shorts. A visit to the FAZ message board is a strong case that the low is in. There appear to be lots of amateurs caught in triple short ETFs. On a shorter term basis, our stance is still the same - we are overbought shorter term, so we will be bearish into the 27th (low) and wait for the next buying opportunity. We believe SPX can make it to 1008 over the next few months - hopefully.

Rant (As always feel free to ignore):- Today the treasury spent another 1Trillion dollars. In a perverse way, we are fortunate that the banks are not lending. The FED has injected tons of money into the banking system. If and when the banks start lending again, we can be assured of high prices of everyday goods. Now with supplies diminshing at the rate at which they have, will high prices be on their way? I don't know the answer yet. It is a possible scenario. If prices do rise, will the FED raise interest rates again? Will they have the guts to do it? or will the market force it upon them - I am siding with the market on this one.