Sounds to me like you should be selling puts if you think the...

Sounds to me like you should be selling puts if you think the lows are in and volatilty is on the slide

You may be correct that the lows are in, but i think we are at least due another re-test, as i dont see any clarity on whether the govt's/central banks actions have been successful anytime soon. With the weight of bad economic news continuing, if not increasing, i expect another exhaustion re-test.

In the short term i dont see any major stimulus for a large rally, as:

- Potential good news already out there, and market unable to break free of range.
- Short interest not that high at present, therefore limited short covering impetus (read article below)
- De-leveraging process of banks, hedge funds, mutual funds, individuals is still very much in progress.

I would appreciate if you could provide an opposing view to my logic? As you say im happy to trade this trade, and if im wrong i have stops in place

NEW YORK, Dec 24 (Reuters) - Short interest on the New York Stock Exchange fell 3.1 percent in mid-December, the exchange said on Wednesday, suggesting a decrease in bearish sentiment in the stock market.

As of Dec. 15, short interest fell to about 13.71 billion shares, compared with 14.14 billion shares as of Nov. 28.

Short interest as of Dec. 15 was equal to 3.59 percent of the total shares outstanding on the NYSE, the exchange said.

Investors who sell securities "short" profit from betting stocks will fall. Short-sellers borrow shares and then sell them, waiting for the stock to fall so they can buy the shares back at the lower price, return them to the lender and pocket the difference. (Reporting by Phil Wahba)