Morning Thought #2

Since the Barron’s Roundtable cited that Bill Gross is recommending [[CFC]], is it OK to kick him down some stairs? Is dementia is setting in?

Thoughts? Anyone?

“If you ain’t got fertilizer, you ain’t got shit.”

Just a thought, if you’re looking for strong relative strength stocks. [[MOS]], [[AGU]], [[POT]], and [[CF]] continue to confound and de-bank the shorts. But, if you decide to step into that potential bull trap, keep your finger on the trigger.

Otherwise, play defense and protect your accounts. Now is the time for focusing on preserving capital, not taking risk.

For sport, I shorted [[UA]]. It broke a spread sextuple bottom out of a big base. That’s right. Six bottoms and a big base to boot. It’s rare when you see this kind of pattern. It’s almost as rare as a 1909-S VDB penny.

 Call it what you may, but capitulation by the longs comes to mind.

(The nomenclature on the chart produced by stockcharts.com isn’t quite right. It’s more than a triple bottom. If you look to the left from the “5” at the bottom of the column of O’s, you will see another three columns of O’s with bottoms at $33 since March.)

Have a great weekend.

Disclaimer: This information is not intended to be used as the primary basis of investment decisions.  Because of individual investors requirements, it should not be construed as advice designed to meet the particular investment needs of any investor. Consult your financial advisor prior to taking any actions. The information and opinions contained here are those of the author and are not necessarily the same as those of iBankCoin, its principals or its affiliates.  

Frankly, I’ve been very busy this morning selling and taking some more profits on my long positions and limiting losses by selling the laggards.  Contrary to what the average “Joe blow” investor does, I prefer to sell when the market has an uptick. 

That said, my conviction is clear. I believe that we are entering into a market environment where it will be difficult to make money, and easy to lose it, if you’re long stocks. Right now people should be looking for ways to protect their money via hedging or shorting weak stocks and sectors, if they’re more aggressive. Or, simply increasing their cash position.

The tide will take all the boats down in the harbor.

Additional update on what I’ve sold, developing….

Ok, bulls. You had some weak bears worried this morning. Nice try, though.

As I indicated in this mornings comment, the market is heading lower. Take advantage if it, if and when you can.

Throughout the day, I was blessed with gifts and nicely wrapped packages of [[SKF]]@124.44, [[SRS]]@92.73, [[DXD]]@55.85, [[FXP]]@78.95, [[USO]]@107.66, and my developing corn dog play, [[DBA]]@39.35.

Although I didn’t “load the boat” on these, I did fill the shopping cart  1/3 full. One should never go “all in” when some squiggly lines tell you to. That’s for those with a streak of reckless abandon and gambling fever. Plus, there should be a balance of some longs to offset the short positions, just in case your dreams of being the “King of All Short Sellers” gets shattered by some bullshit economic report.

Besides, I prefer to scale into a postion and scale out of a position. Slowly, like foreplay.

Note that these little rallies, be they shorts covering or hopeful bulls buying, are opportunities to take profits and/or get short. Use ’em or lose ’em.

Until next time….

Disclaimer: This information is not intended to be used as the primary basis of investment decisions.  Because of individual investors requirements, it should not be construed as advice designed to meet the particular investment needs of any investor. Consult your financial advisor prior to taking any actions. The information and opinions contained here are those of the author and are not necessarily the same as those of iBankCoin, its principals or its affiliates.