Wednesday, September 16, 2009

Quicknote (plus CFSG shoptalk)


Action today is quite firm. Underlying internals are strong enough presently to suggest a reversal is unlikely today and the potential for closing at or near highs is reasonable. Note that underneath the major averages the NYSE and Russell 2k are outperforming, along with Financials (XLF); which have finally managed to join the new-high party.

I let go the SKF hedge early today, which turned out to be fortunate and as such I'm riding significantly exposed on the long side just now. I still have the UUP dollar hedge and I still hold the Cramer fade FLEX short (1-3 day trade only), but basically I am significantly long at moment (long and wrong; long in the tooth; longing for more of this joke of a rally ;).

CFSG-long is new here. The name is poised now for break-out (we'll see) and is posting the biggest volume on record [edit: biggest since July '08]; following a presentation overnight in China. There are a lot of interesting ingredients here (Chart is poised; 2-year lifespan is favorable; management holds a 60% position in the outstanding shares; strong margins/cash-flow; it is, well, a Chinese ADR), but it is less than perfect (group is poorly ranked, although I will break this discipline at present for Chinese ADRs if highly ranked; name is thin, although thin-is-in these days; Growth is less than stellar, but at same time PEG ratio is favorable (price/earnings/growth), ideal is to see RS run to new highs ahead of a bkrout and so far not the case).

If you understand that last paragraph then you're hired - I could use the help.

I may or may not re-hedge the overall position here at the close (earlier, certainly, if we begin to reverse); cannot say at the moment, but last night's post still represents my near term thinking.

Other trades today are recorded on the Twittfeed on right>>> (I am indeed going to get the number of longs down, even if I do not yet reduce overall long exposure; today was a small start).

Beast out

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