The Fix is In

You can argue all you want about how Starbucks has long-term coffee prices locked in, or any other fancy notions of how the CEO’s business acumen somehow makes the stock immune to steep corrections.

But the truth of the matter is that SBUX Is almost assuredly getting hit with both sympathy selling due to the strength in the coffee commodity (no one said the market had to make sense–It is an emotional beast, oftentimes), as well as the rubber band snapping back for the crowded consumer stock itself in recent quarters. If you follow my work, then you know I have discussed these concepts many times in recent months.

Overall, the broad market remains in correction-mode, which means you can sidestep big drawdowns by keeping cash levels high in your portfolio and picking off opportunistic, inter-market trades we are stalking inside the 12631 Trading Service this morning.

As I noted over the weekend in my Strategy Session, even though stocks like F GM may have been too steep to safely short early this week, they are still dropping lower yet. Similar comments apply to Russia–RSX. Thus, for now, I am resisting the urge to bottom-pick.