iBankCoin
Joined Jan 1, 1970
509 Blog Posts

This Market is “Enchanting”

Wow. Just got back in after doing a road show, and saw the ISM number came in at 40.1 for April. This leading indicator is significantly higher off the (“bottom”?) December number of 32.9. (For you illiterates, a reading under 50 is indicative of economic contraction.)

Should the May number break above 41, that could be a sign that we could be getting closer to a quarterly GDP growth number. Odd, no?

This is a “less bad” number and would indicate that buying the dips might be a good strategy here.

Just saying…….

Have a good weekend!

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Long In The Tooth

Look people, I realize that many non-sophisticates are getting all school-girl giddy and giving out free hugs because of this recent rally. But simply know and recognize that this market is getting long in the tooth, old-man style.

Yesterday saw the NYSE Bullish Percent rise to 65%. Keep in mind that the last rally from the end of November thru the first week in January topped out at a 66% reading. So, we are approaching overbought territory. Is the outlook going forward, better now than in January? Hmmmm….

Plus, I have noticed that the breakout activity is starting to taper off from it’s prior blistering pace. Yes, there are pockets of peace and goodwill due to things like optimism, but remember, optimism isn’t an investment or trading strategy.

As for me, I remain cautious, having made my lionshare of returns this past month. So, I’m positioned, hovering over my kill, like a big cat waiting to pounce on anyone or anything that would try to steal from me or threaten my survival. In market lingo, I’m getting ready to get short (and swipe the heads off the bulls).

Optimal Alpha is 45% cash, 55% long equity and 32% short equity. Still hanging on to 48% gains ytd.

Carry on.

UPDATE: I’ll be traveling the rest of today and will be out of pocket tomorrow, visiting clients. I’ll post here and in The PPT this weekend. Happy trading.

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Non-Predictibility Is In Play

Since logic and earnings predictibility have been thrown to the four winds, it makes sense that fourth-tier stocks like REITs, banks and retailers have been leading the surge.

To wit….this uniformly profitable and glorious play using REITs was up over 5% today, despite the flu-laden SRS:

Ticker  Shares Cost Basis/Sh Cost LAST Total Position (FMV) % ▲ Gain (Loss) %CHG TODAY
MAC 40,000 $8.28 $331,200 $16.68 $667,200 101.45 9.95
CBL 90,000 $2.65 $238,500 $7.76 $698,400 192.83 12.79
BXP 10,000 $37.12 $371,200 $48.49 $484,900 30.63 3.81
SRS 30,000 $34.19 $1,025,594 $23.76 $712,800 (30.50) (7.62)
               
      $1,966,494   $2,563,300 30.35 5.01
               
               
               
  Long   $940,900   $1,850,500    
  Short (effective) $1,025,594   $1,425,600    
  Net effective long(short)   $424,900    
               
               
Previously Sold:            
KIM 93,000 $7.55 $702,150 $9.05 $841,650 19.87% 04/06/09
CBL 87,100 $2.65 $230,815 $6.56 $571,472 147.59% 04/17/09
MAC 40,000 $8.28 $331,200 $15.39 $615,600 85.87 04/27/09
CBL 90,000 $2.65 $238,500 $7.15 $643,500 169.81 04/27/09
BXP 8,900 $37.12 $330,368 $47.97 $426,933 29.23 04/27/09
SRS 28,000 $34.19 $957,221 $26.51 $742,280 (22.45) 04/27/09
               
      $2,790,254   $3,841,435    
               
          $1,051,181 37.67%   

Best wishes for a flu-free existence.

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Locked Out

With a 50% cash position and a short hedge via TWM, I am effectively locked out of this rally today. To add insult to this inglorious happening, I’m down about -0.63%. Not a disaster, just frustrating to leave money on the table by selling early yesterday.

However, I did pair trade DBA and DZZ today.

In effect, long grains, short gold.

UPDATE: Not to worry, the REIT strategy is up 2.80% today, in spite of SRS.

Trannies looking strong, performance beating both the Dow and the S&P by a factor of almost 2.

I guess we’re going higher.

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50% Cash…..

I spent today selling. Tomorrow I will start to add SDS and SKF on the first sign of a meltdown.

Today’s trades:

Sold:   Cost/Sh Cost Price Value % G/L Date
GOOG 5 $367.75 $1,839 $384.26 $1,921 4.49 04/28/09
MIC 2,000 $2.04 $4,070 $2.23 $4,460 9.58 04/28/09
ACAS 2,000 $2.05 $4,100 $2.68 $5,360 30.73 04/28/09
KEG 400 $4.39 $1,756 $4.47 $1,788 1.82 04/28/09
AINV 900 $4.40 $3,960 $4.65 $4,185 5.68 04/28/09
TWC 250 28.11 $7,028 $27.11 $6,778 (3.56) 04/28/09
LVLT 3,000 $1.08 $3,240 $1.03 $3,090 (4.63) 04/28/09
ENER 250 $15.58 $3,895 $15.96 $3,990 2.44 04/28/09
EGLE 300 $5.69 $1,707 $5.70 $1,710 0.18 04/28/09
OWW 2,500 $1.50 $3,757 $1.48 $3,700 (1.51) 04/28/09
GNA 900 $4.32 $3,891 $4.42 $3,978 2.24 04/28/09

Have you been watching the trannies? The DJ Transports closed at 2,991.

The 15 day EMA is 2,983. The intraday low was 2,936.

 

Key off of this and the VIX.

“Optimal Alpha” is up 48% ytd, with current cash just north of 50%.

Good night.

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Deja Vu All Over Again

What year did this cartoon appear in the Chicago Tribune?

(Hint: it was over 47 1/2 years ago)

I’ve been a net seller today (again).

Sold GNA, OWW, EGLE.

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