As noted in this tab on May 12, I bought $TZA, $SKF and $SDS to play the short side. I only bought each position in 1/3 size of what I would consider to be a full position. As luck (sort of) would have it, literally since the moment that I bought those inverse ETFs, we have gone straight down 50 $SPX handles. Stairs up, elevator down, to say the least. At this point, I believe it would be a mistake to add to those positions here. The closer we get to the 200 day moving average, just above 1100 and rising, the more inclined I am to take any kind of short exposure off of my books.
Thus, I have sold out of those three ETFs. $TZA at $6.50 (bought at $5.75 as documented in The PPT). $SKF at $20.51 (bought at $18.32 noted in The PPT), and $SDS at $32.89 (bought $30.38, see The PPT).
I have also fully sold out of longer term trades–long $BZ, $SWHC and $VCI.
I am currently in 100% cash, and remain convinced that is the best course of action for now.
Thanks Chess,
Thankfully I now hold very few longs and they are small positions. Likey about 80% cash. What I struggle with is to see what could the catalyst be that gets us over this and headed up again?…Buehler????…Buehler????…Buehler???
I suspect that long before the catalyst becomes obvious to the retail investor, the institutions will accumulate stocks and help the charts form sound bases. We are still quite a ways from that point from my perch.
Haha, I like the separate title of your trades; it’s clever. Best luck on the cash thing. I’d follow but I’m too terrified of the people who hold the keys to the Treasury, at the moment.
Thanks, Cain. I like your tobacco idea–$MO. I was also looking at $BTI, because they are obviously getting hit now in Europe. I know Hugh Hendry has his select long exposure in tobacco, and he is on record as saying he thinks they come out shining in a consumer depression. Do you like the fundies in BTI?
Nice call on the 1124 level. Looks like we may be bouncing off it and pushing lower.
Yup, the 150 day moving average–just like in early February–is one of those moving averages no one pays attention to (except Carter Worth of Oppenheimer), yet the market is telling us it is a key battleground area.