Dow Futures
This report is as of February 14, 2006

"You try to be greedy when others are fearful, and fearful when others are greedy" - Warren Buffet

Heavy volume pushed the major indices higher on Tuesday. After a sluggish start to the day, an impressive increase in retail sales outside of autos turned the market sharply higher.

According to many analysts, there really wasn't any new fundamental news to spark the rally. Instead, the move seemed to be technically driven. Investors seem to be shrugging off anticipation over Bernanke's first congressional testimony.

Today's move puts the Dow at the top of its trading range, while the Nasdaq and the S&P appear to have some room to move on the upside. It will be difficult for the Dow to break the old high of 11085, but a retest is highly likely.

February is the weak link in the "Best Six Months" according to the Stock Traders Almanac. Remember, the S&P has been up 12 of the last 14 trading sessions that immediately precede President's day.

 
Dow Recommendations
Swing Trade - Long from 10904, to those receiving email updates we recommend to liquidate this afternoon at approximately 11025. That would have been a profit of about $1,210.

Position traders - We are short a March 104 put and a 110 call, we collected about $800, a little nervous on the call side.

Option traders - Long the March 108 call and short 110 calls. We paid about $250 for the spread. Our risk is theoretically unlimited above 11,200 and limited to $250 on the downside. Call me if you have questions. This morning we started putting on bearish ratio spreads. Buy the March 110 put and sell 2 108 puts, this should cost you about $150.