Sunday Evening, and DaBoyz Are Trapped in a Very Risky Game

DaBoyz have pulled their bids early Sunday evening, allowing the E-Mini S&Ps to fall 17 points so far — equivalent to a 140-point drop in the Dow. Air-pocket weakness such as we are seeing at the moment very often produces a bullish outcome, since it allows those who jockey the markets for a living to exhaust sellers, the better to set up a short-squeeze rally on the opening.  Sometimes this strategy will fail, however. It may happen that that the initial leg down proves to be a relative ripple ahead of a tsunami. Even DaBoyz don’t know yet whether this will turn out to be the case, since it is unpredictable as to whether the price drop that has already occurred will touch off a panic that could generate yet new waves of selling. Fading the trend on a Sunday night is a dangerous game, to be sure. Whatever happens, the DIA puts and VXX calls that many subscribers bought last week and which were already showing very substantial gains have effectively immunized them against fear or worry.