The March Mini S&P Index is up 3.75 points at 1112.00 this morning as I write.  The included chart shows that the S&P is continuing to challenge the 1114.00 to 1115.00 area of the recent highs but with no follow through so far.  The directional movement indicators are now back to the bull side but the thing that continues to concern me is the fact that the ADX line continues to fall lower.  The ADX line falling to lower levels tells me that this current  up move does not have a lot of momentum behind it.  I would call this the reluctant rally.  Otherwise I would be considering adding more bullish positions to our current positions.  I recommend holding on to our ratio call and put spreads.

Followers of this letter should be long one March Mini S&P (1190 strike) call from 17.00 and short 2 March Mini S&P (1220) call options from 9.50.

You should also be long one March Mini S&P (1000.00 strike) put option from 23.00 points and short 2 March Mini S&P (935 strike) put options from 12.75 points each for a total credit of 2.50 points or $125 gross.

March Mini S&P options expire in 87 days.

 David Hall

 The information and opinions contained herein comes from sources believed to be reliable, but are not guaranteed as to accuracy or completeness. The risk of loss in trading futures and/or options can be substantial. Each investor must consider whether this is a suitable investment. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results.

 This newsletter is not intended for dissemination to the public without prior approval from David Hall.