Thursday, July 22, 2010

Resolution #9

After whip-sawing and crack-jawing every day since last Thursday, today smacks of resolution.

I suggest this based on the combination of higher-highs (since the floor-drop last Friday); positive momentum (shorter-term technicals pointing upward); sufficient gloom, malaise and/or general disrespect (negative sentiment is prevalent, even among buy-only professionals); and today's severe-positive internals (extreme positive Advancing vs. Declining stocks, on strong, rising volume).

Bears should be left hungry now, as a rally has apparently begun to thaw.

I've let go index hedges, but I'm so far holding onto a couple names short. If I'm wrong to give up hedges here and protection turns out to remain important, then I am going to begin letting go longs (gradually, appropriately and according to the pressure) instead of re-hedging and keeping this heavy line. Part of this is because it is getting to a now-or-never period for holding a bullish theme (now that I can taste the resolution, I know I'm in trouble if it fails), but also because I am going to be trading lightly for most of August and I don't want too many kids in the crosswalk while I'm not around minute-to-minute to direct traffic.

August note: August this year will be my rest-month. At my age (I am ancient you know), I take a hopefully-slow summer month to rest my brainpan; in order to better ramp-up for fall and winter (my two favorite market seasons). I expect to have fewer positions as we get to the end of July.

Follow Centrifugal to fade trades in real time.

Total Position: Currently 5.29-to-1 net-long, 69% invested

Currently Long (according to size): CRM (9.9%); CXO (7.8%); EWS-Singapore (7.1%); AVGO (6.7%); VMW (6.1%); APKT (5.8%); LOGM (5.3%); OVTI (5.2%); NFLX (reduced today, 4.6%);

Currently Short: DISH (6.3%); BP (4.7%)

Futures: 30% Long Sep Russell2k, from 628.35 ave; added today, 1-3 day trade


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