With the market at new highs, it’s important to watch the underperformers and sell them short. Bear in mind, if a stock cannot rise in this environment, something is wrong with it. This isn’t technical or fundamental analysis. Simply put, I am a servant of trends. On occasion, I become obsessed with a thesis and will fixate my energies on it. But for the most part, I am buying and selling whatever the market is rewarding and punishing.
Steel and Iron should be avoided, especially AKS, GGB, SID, MTL and CLF.
Their balanced sheets are dreadful and people are fleeing the shares.
Small cap oil drillers are death. Avoid them.
Metals and mining are heading lower. Avoid names like WLT, ACI, BTU, MCP, EC and GTI.
Once again, gold and silver miners are heading lower, on their way to fresh 52 week lows.
Stocks that look especially bad are NEM, ANV, IAG, AG, EXK, HMY, ABX and NG.
Copper and aluminum should also be avoided. There will be the temptation to buy into these sectors, hoping for a bounce. But these are bad sectors and really bad companies. The market has discarded them in the same way and fashion that the warrior spartan class tossed deformed babies off mountaintops.
Do not let these bottom feeders taint your rich portfolios with their disgrace.
Ignore them or sell them short.
Have a nice weekend and enjoy the sequestration galas being held throughout NYC this evening.