Monday, November 30, 2009

Learn While You Churn


The S&P 500 is now flat for the last 7 weeks; the XLF (Financials) is at the same level as early August; my fingernails have grown throughout, but I keep biting them back and they remain just as short as ever.

A true contrarian has been market-neutral for this period, but unless you've been a seller of straddles or something, that and a cup up coffee still won't buy you four bucks.

The bull market is frustration.

My advise for 95% of you (not me baby!) - unless you have something screaming at your insides, absolutely demanding you get involved, wait and be one-step late to the attack (and back-off abruptly if it doesn't then follow through; like today for the bears). Tops are a process and most of the easy money can be made by simply waiting to pounce; while firing too soon has a way of hampering your animal blood spirits.

If you're bullish and wish to play it that way, find a seat (if there are any still open) and wait for the market to post a proper breakout; hopefully remedying some of the uglier recent divergences while consolidating in the meantime.

For your sake.

Excitement is coming, but apparently not quite yet. We have acted nothing less than fairly awful for several weeks now (aside from some mostly-Chinese small cap growth names) and yet the market has resisted anything serious in terms of downside.

We shall see. I'm holding more short than long (again!), but I'm not really interested in a fight.

What's to learn you ask? The smartest trader in the world lately is the one who took a vacation; away from this arena.

Aggressive Accounts:
-Total Position: ~2-to-1 net-short, considering levered (2x's) TWM hedges
-52% invested overall
-Pure-longs = 20%
Currently Long (according to size): QSII (6.3%), DGW (5.3%), CML (new today, 4.4%), HEAT (reloaded today, 3.5%)
Currently Short (according to size): TWM-long (Russell 2k Dbl-short, reduced today, 11.9%), HBC (7.9%), SLAB (new today, 5.1%), XLNX (new today, 4.2%), TRLG (new today, 3%)
(Note: inverse-ETF TWM represents being dbl-short the R2k index)
Futures Accounts: - short 40% Dec NDX, from 1759.75 ave; short 10% Dec SPX, from 1091.75; relevant accts only

Other Accounts:

-Total Position: ~1.4-to-1 net-short, considering levered (2x's) TWM hedge
-38% invested overall
-Pure-longs = 20%
Currently Long (according to size): QSII (6.3%), DGW (5.3%), CML (new today, 4.4%), HEAT (reloaded today, 3.5%)
Currently Short (according to size): TWM-long (Russell 2k Dbl-short, reduced today, 11.9%), SSG-long (Semiconductor Dbl-short, 6.9%)
(Note: inverse-ETFs TWM, and SSG represent being dbl-short their respective indices)
Futures Accounts: NA

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