waiting for a rally

market opened up around 8 points this morning, but the housing starts dumped causing a pull back. looks like its gonna test the lows from friday. meanwhile my TZA is running up nicely as the small caps are dropping the most. question is where to get out of some tza and convert to options which have much more leverage. I'm thinking 10.50 to 11.00, (at 10.15 now) and taking 1/3 off the table at that point just in case it continues up (market drops). I am looking for the s&p to bounce to the first safe shorting level of 1124, but so far it hasnt even broken the 1104 level. I need to sell some tza in order to buy tza calls. problem is the money doesnt go into the account till the next day, so I am exposed to any overnight adverse action. the market seems to be treading water at this point... fomc on wednesday, bernanke reappointment or not, apple new product on wednesday. and a multitude of earnings reports this week. probably needs some catalyst to blame the mkt move on. meanwhile the vix is still high, relatively, and options are about double the price now. the time to buy them as before last wednesday. My TZA feb 9 calls are now a double ... Wish I had had the money to take that trade. it was right on.