Gonna Bet on a Rotation Here

This is the exact opposite of what I usually advise people to do: betting on a trend that is not yet dominant. But there is precedent for what I am doing. I am thinking with today’s strength in basic materials and industrials — we might begin to see some continuation there.

If we do start to see oils, steel, tankers, and construction plays jimmy higher, we might be entreated to a massive market rally, an 80% up day.

This tape can be described as dull, as nothing of extreme importance is underway. Never short a dull tape. If you are short here, you must pray to the Gods rates spike. But the fact that rates have already spiked and markets haven’t gone down is a WARNING for you.

If you are short here, I would immediately hedge those shorts with some longs.