The market continues to act in classic fashion. After a nice runup last week, equities started the new week with a narrow-range consolidation session. Monday's price range was contained within Friday's, and volume dropped off precipitously. Given that tomorrow is Election Day, I suspect we'll get more of the same before breaking to the upside Wednesday, but who knows? Last week's biggest day came ahead of the Fed... which is quite unusual behavior... so perhaps the rally will short-circuit the elections. I'm not going to press any bets at this point, though.
Another indication that our rally is still intact comes from the fact that the dollar was quite strong today, but its strength did not derail stocks. In fact, with the exception of oil, commodities hung tight, as well. I suspect that whatever the election results, the currency markets will use it as an excuse to weaken the dollar, and our rally will continue.
For those of you anxious about long positions, finding a couple juicy short setups could provide for a hedge and hence, holding power. After my Vegas trip, I scanned through the charts of the public gaming houses and found them wanting. Take Wynn Resorts, for example:
Wynn seems to be undertaking a typical A-B-C correction. Once the B-wave finishes, we should see a C-wave move, perhaps up to resistance at $69. At that point, I'd like to take a shot at the short side of this one.