The market correction related to the recession and the credit crisis was in full swing today as, at one point, the market was down a record 800 points.

Obviously, I stayed short during the morning session and tried to stay long in the afternoon session. It was not easy to stay in trades again today, as it took extremely wide limits and stops to take advantage of the price movement. The volatility was extreme and it took a steady hand and steady nerves to scalp trades with any effectiveness. Of course, my conservative nature was tested by this market action, and I bailed out of several trades when I had made my three points, but if I had let the trades run they would have been much more profitable. Past readers of this blog will be familiar with me self flagellation on this issue, but I figure a bird in the hand is worth two in the bush and have never been able to dislodge that thinking from my constellation of thought.

The blogs and posting boards have been chirping about a possible government intervention in the market this afternoon. I find it hard to believe that the market could back from 800 points down, especially with many small investors idled and the hedge fund cabal playing the markets conservatively of late, but come back it did, all the way to the mid-300′s. I’ll let you decide as to the nature of the dubious comeback the market staged, as I am not much of a conspiracy theorist by nature.

Anyway, the market did hold some nice support and resistance lines through the day, and when it did pierce those lines it was usually on exceptional volume so the calls were not difficult to make. As I said, tuning out all the noise and movement in the market was my primary objective. I even turned the television off at one point in the afternoon, as that lunatic on MSNBC went on rant of unparallelled intensity…at one point suggesting anyone who needed their money in the next five years to get out of the market now. Ah…the guy is more of a distraction to trading than a valuable source of news. I ended up 10 pts. on 1 contract on a day that there was far more for the asking.