I’ve been wanting to get short Basic Materials via [[SMN]]. I’ve been watching the ETF trade, and missed a good entry last week. I’ve realized that there is something about SMN that I do not like. Maybe it is the volatility, or the lack of liquidity.
In contrast, [[XLB]] is very liquid, trading almost 20 million shares today. (I apologize for leaving volume off of the above chart.) The chart is a short-setup dream, with failures at the major moving averages in the midst of a huge topping process. Ideally XLB will bounce a bit and give an entry closer to the moving averages.
Included below are the components of the ETF. I especially enjoy the opportunity to be short [[MON]].
Here is the link to the website with more information about XLB: Materials Select SPDR Fund XLB
I hear some vindictiveness in your voice concerning my poor MONster.
Hmmmm…
Ah well, short away, I’m completely out now.
(But I will be getting back in at first opp!)
Geez, how did those ETF asshats allow MON to become such a huge percentage of their portfolio??
Ever hear of “rebalancing” fellahs?
An awful lot of petro-sensitive stocks in there … if Fly is right about the price of oil then MON may not matter ….
Wouldn’t you rather be short more than 45% in steel, copper, gold, aluminum and the oils based on a deflationary environment?
Not questioning yer TA but the leverage afforded by the ETF
MON is 12% of SMN …
But I retract my stmt upon review of the SMN components and finding about 35% exposure to metals…
Other option is to go long the USD via UUP if you by into the deflation argument of weaker demand, lower interest rates and a rising $
You really think USD is to go up when they print more $
That’s what happens in the long run from deflation …. on the other side of recession … a long slow process, not a day trade senario.