The Greek Prime Minister George Papandreou will hold a referendum on the new European bailout package. The news sent a shock wave to the global markets. S&P 500 plunged more than 35 points. “Buy the rumor, sell the news” was effective today. I was just too shocked to join the bears for the day.
The opening gap was huge (way below 1,242), I didn’t sell at open. I waited until the dust settled which is 1.5 hours after the opening. In these days I have to do that because the market behaves basing on news from the Europe. Using the 2 minutes graph, after the 1st rebound (at least 3 consecutive greens) sell on the 3rd pull backs (why wait on the 3rd pull backs? Because I want to make sure that is a down trend). Also I was bullish bias, thus I reloaded my positions on the 1st pull back after a rally that lasted more than 10 minutes (because I want to avoid a bear flag) from a lower low.
Two things that make me keep my bullish bias are FOMC is on tomorrow and VIX rose over 30% in two days.