As you can see from today’s wild action, the fiscal cliff drama is creating serious volatility in the markets with the indices closing near their highs for the day having plummeted earlier, before the announcement of a 30th December 6pm meeting.
Your choice from here is to either trade a pattern knowing that we’re in a somewhat news-driven market where you could be whipsawed to death, or to sit on the sidelines.
There’s no shame in sitting this one out and waiting until the market returns to a more technically balanced position and not so news driven.
Look at the OVI charts tomorrow to see if there’s been any change in the options market sentiment. My guess is not much. The OVI charts are ready around 1am New York time.
All the best
Guy