Daily View Friday 22 January 2010...

And the bloodbath continues. Today's action just caps a week of pure, unadulterated carnage in the markets. Despite the selling onslaught, I still believe (for now) this is a painful correction rather than a reversal, and I'm playing it as such. We've had a 5% or so pullback in the domestic indices and 10% or so in the foreign indices. The selling this week, and particularly today, felt very panicky. We're due for an oversold bounce and the success/failure of the bounce will be very instructive.

I'm not a slave to the $VIX, but in the past two days, it's gone from 18 to 27 and it spiked right into its 200-day EMA. The last time it did that was back in early November, at which point all the indices ended their short-term corrections and proceeded to power higher.

I made no trades in the trading account or IRA today, but I did a little buying in the 401k. Small additions to my $MID and $RUT index funds, as those hit my buy points at the 50-day EMAs with today's close. Those two tagged their 50-day EMAs at the close today, while pretty much every other index I'm in sliced right through them today.

Another ugly day on the watchlist. For active positions, RGR and CRE held tough today, which is a true testament of strength in both names. I'm liking both of these. CRE had particularly large volume today, which is interesting to me. FUQI was flat on the day, but showed some signs of life. This one may give me the rally I'm looking for to reduce my loss in the position. CBI pulled back today a couple percent. I'd like to see it pull back a bit further before I close the sell leg, and I think I'll get that. Like with FUQI, I'll add to my existing long call position once I see some signs of upside.

CEU, EME, GFRE, and IACI have all pulled back to logical buy points. These are ones I'm looking at to get long with a tight stop. ESI is looking strong, as well.

JST is in no man's land. I'll keep it on the watchlist, but I'm not looking to enter it yet.

I'm updating my watchlists and screens tonight, which I'll discuss in the weekly view.

Position: Long CBI, CRE, FUQI, RGR, $MID index fund, $RUT index fund

Disclaimer: This is not a recommendation and is presented for informational purposes only.