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Back in late August, I wrote this post discussing the idea that Berkshire Hathaway’s share price had become a much better broad market, and in fact macroeconomic, “tell” than it had been in decades due to the cyclical nature of some of Warren Buffett’s recent acquisitions and investments (Burlington Northern Santa Fe, for example). Indeed, from a technical perspective, $BRK-A shares were flirting with a multi-year breakout from a massive symmetrical triangle during the summer.

Presently, $BRK-A has broken out of the triangle and is consolidating nicely above all major moving averages. On a weekly timeframe, the constructive nature of the price action continues to be a good reminder that, despite all of the terrible economic data and egregious monetary and fiscal policies, we simply must trade the market that we actually see, instead of the one we think we should have.

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1/2 starter. Tight stop. Time-stamped in The PPT. Details on the chart.

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Over the past few days, Mr. Market has adopted more personalities than Joaquin Phoenix after going off his meds. There are a couple of ways to view the increasingly violent price swings. First and foremost, remember that we are still in the midst of earnings season.

To me, trying to be a disciplined swing trader during earnings season is a lot like being invited to a party at Barney Frank’s house: It might be high profile with a lot of fun times to be had, but it’s just not my cup of tea. Beyond earnings season, the S&P has had an impressive run from 1040 up to 1189 today, and a 3-5% correction would be entirely reasonable and healthy within the context of a rally.

With all of that said, however, I want to remind you of how many serial top callers and underinvested bulls miss out the meat of virtually every bull run. There were a few days like today in that February-April run that we had this year, and they were not, in fact, the top. Instead, they proved to be excellent buying opportunities. Why, you ask, do so many people miss out on the majority of bull runs? The answer is because Mr. Market is a hater of epic proportions, even more so than other financial blogs who refuse to link to iBankCoin despite our heavy web traffic.

As I am writing this, I see that we continue to reverse hard off of this morning’s gap higher. We are back just below the support trendline, but I will look to see if there is more follow through before being too conclusory about whether this is “the top.”

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Thus far today, I made the following trades:

• I bought a 3/4 position in $CTSH, a name that I featured last Sunday as a top setup.
• I sold out of the rest of $SDS.
• I bought back 1/4 more of $HMIN for a full position again.
• I took the loss in $WPRT and sold out of it.

All trades are timestamped inside The PPT.

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TOTAL PORTFOLIO:

EQUITIES/ETF’s: 44%

• LONG: 44% ($ATPG $CTSH $DDS $HMIN $MSTR $RGS $SHLD)

CASH: 56%

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I am still on the neutral team here until the picture clears up in the next few days. A big down day yesterday, a big up day today. Something has got to give.

At this rate, I am drinking enough espresso to bide my time that I will soon have the appearance of Steve Buscemi after a three-day crystal meth binge.

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The S&P 500 is impressive in holding above yesterday’s highs. I took out the full $SDS position yesterday as a short-term insurance policy, and so far I have paid a nice little premium for holding it. Just now, I sold 1/2 of my position, and will likely sell out of the rest by the closing bell, should this rebound stick.

All trades are timestamped inside The PPT.

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TOTAL PORTFOLIO:

EQUITIES/ETF’s: 48%

• LONG: 44% ($ATPG $DDS $HMIN $MSTR $RGS $SHLD $WPRT)
• SHORT: 4% (Long $SDS)

CASH: 52%