Subscribers reported using my rally targets last week to get short a hair from the top in DIA and the E-Mini S&Ps. Stocks subsequently fell — the Dow was down almost 100 points on Friday from the peak we’d shorted — but we weren’t patting ourselves on the back as the week ended. Indeed, we’ll have to weather whatever gaseous rally occurs Sunday night or Monday morning, presumably after index futures have been shaken down in order to dry up selling. A further challenge for patient bears could come from the high-flying stocks that are the exclusive domain of institutional traders. They have jolted this group alive again, most recently with a short-squeeze in NFLX that pushed the stock from 97.05 to a an intraday high of 117.88 on Friday. That’s a gain of 22% in mere hours, adding roughly $8 billion of ‘wealth’ that is unlikely to trickle down to Walmart shoppers. Apple’s earnings will be out Tuesday after the close, and even in the event that they are less than stellar, DaBoyz will not pass up an opportunity to short-squeeze the stock as mercilessly as they can.
