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I am back to full positions in $HMIN and $TIE, as they are setting up for higher price and are not yet too extended to buy.
All trades are timestamped in The PPT.
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TOTAL PORTFOLIO:
EQUITIES/ETF’s: 62%
CASH: 38%
Comments »Enough said.
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[youtube:http://www.youtube.com/watch?v=-lGnHqlXilg 450 300]r______________
[youtube:http://www.youtube.com/watch?v=DnvXpLOzKeQ 450 300]r Comments »I sold out of my $QID position in full. After technology has rested for the past few weeks, and is now moving higher today, I am unable to justify holding that hedge.
I also bought a 3/4 position in $MSTR, based on one of the most historically accurate features inside The PPT algorithm.
If you are caught heavily short right now in the market, remember that there is nothing so terrible about being wrong. Rather, staying wrong is usually the genesis of the major losses that traders suffer over the course of their career. The market simply does not want to roll over, and barring any major reversal it looks as though the bulls have finally conquered 1150.
All trades are timestamped inside The PPT.
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TOTAL PORTFOLIO:
EQUITIES/ETF’s: 54%
CASH: 46%
Comments »[youtube:http://www.youtube.com/watch?v=cN8WeadBW1o 450 300]r
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…to conclusions.
I lightened up a little bit this morning before the market sold off further. However, I am forcing myself to stand pat for now. The S&P 500 is still operating above all major moving averages, and we came within three points of hitting the rising 20 day moving average, thus far today. The resilient dip-buyers are probably growing more frustrated with each passing day that we fail to break and hold above 1150. At the same time, the bears have proved inept at pushing us below 1130 over the past few weeks.
I am keeping my hedges on, since my longs are still technically healthy. In this situation, I think it is important to be nimble (Read: a decent cash position), so as to not get caught leaning the wrong way.
Finally, below is an updated chart of the Aussie Dollar/Japanese Yen cross. I believe that this currency pair is the best gauge of global risk appetite, with Aussie strength indicating the commodity-rich country is benefiting from global risk appetite, while Yen strength indicates risk aversion, with an unwinding of the carry trade. I urge you to continue to monitor this chart, as it has settled into a very tight base for nearly three weeks now.
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In the face of the weakness this morning, I am taking my foot off of the gas pedal a bit. I sold out of $GNK for a push, and took off 1/2 of my $TIE position to lock in some profits. I may very well deploy the cash later today to some high momentum names acting well, such as $F and the casino names, but in order for that to happen the bulls will need to step up here.
All trades are timestamped inside The PPT.
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TOTAL PORTFOLIO:
EQUITIES/ETF’s: 56%
CASH: 44%
Comments »In this video, my goal is to walk you through my thinking on the $DZZ hedge that I initiated on Friday. Keep in mind that I am net long stocks, but I am looking to take off my $QID hedge sometime next week if technology continues to correct in time more than in price. I feel that an ultrashort gold play offers more of a “heads I win, tails I win” scenario, where if gold weakens and the U.S. Dollar bottoms out here, stocks may not necessarily roll over. That scenario would be a repeat of 2004, where correlations between asset classes became detached. As you know, 2004 is a relevant comparison to 2010 in many respects. Moreover, even if stocks fall along with gold in a “risk off” herd mentality, then my hedge will have worked as planned, in the sense that it will ease the pain of my losing longs. The only scenario where I get crushed is if gold rockets higher, but the stock market sells off. The last time we saw that happen was in the late 1970’s and early 1980’s, where a wage-price spiral led to massive inflation. Needless to say, with the current economy in a completely different spot than it was back then, I am willing to take the other side of that bet.
Regardless of what happens in this trade, the more important idea is that I believe you should consider how each trade you make fits in to the broad puzzle of your portfolio. Sure, the ultrashort gold trade individually does not make much sense, as gold is in a very strong uptrend. However, there is a little more substance to my style on this one.
Thus, you should always be taking the chess game of the market into account.
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[youtube:http://www.youtube.com/watch?v=T11GRdLH5LA 450 300]r Comments »
