Analysis:
Yesterday's Analysis predicted that "not all Bears have thrown in the towel, leaving an additional room for the market to rally." Today the market initially dropped after an extremely disappointing payroll increase for Nov., but once the market limited its loss, the Bears were squeezed before the weekend set in. Looking ahead to next week, little news will aid the Bulls, so the market will resume its focus on the European sovereign debts with possible downgrades of Greek and Portuguese debt ratings. China's Nov. inflation rate will stoke the fear of further monetary tightening. The Euro Bears, who last week outnumbered the Bulls (as measured by the number of net-short currency contracts) for the first time in recent months, have been squeezed out this week, leaving little room for further weakening of the dollar. As a result, the market will retrace towards 1,200.
Strategy:
Reversed to short at 1,217 for a profit of 20 points
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