Patience Rewarded

S&P futures down over 35 points this morning. Japan down 11% overnight. Grains, softs, metals, energy, all red . . . where is the safe haven that all the TV pundits tell you about? Why is the dollar up when it's supposed to be doomed? Why is the yen up? Why are treasuries up? Don't look for the answers on CNBC.

I took off the rest of my SDS position at 8 am this morning. I still have some March 19 SPY calls that I had bought (and were paid for) against the SDS, but they will likely go out worthless. No worries -- that was the name of the game. No worries while skiing or driving back from Colorado. No worries while I let the markets do what they had to do, even when I couldn't be in front of the screen. That's why I like hedging.

I'm watching the yen. It's getting ever closer to my long-awaited "below 80" buy point. I just wish it didn't take a disaster to get there.

Note the implosion in the loonie and the aussie this morning. That tells us demand destruction is occurring in commodities.

So far the US dollar has turned where it's had to in order to avert the descending triangle scenario. The dollar, the yen, swissie, and US treasuries are the beneficiaries of risk aversion.

There appears to be a declining wedge of the S&P futures which would point to lower prices, but I think we could get a bounce today. There is a Fed meeting. Ben could pretty much say whatever he wants to get the shorts to at least cover.

For now though, patience has been rewarded.