Friday, November 19, 2010

Updated Position (CRM is the institutional darling now)

right-click and expand to view chart

CNBC says we're on course for our second week in a row of finishing in the red. But while the surface of the market today is essentially flat, leadership is driving higher now with intention. That is a recipe for buying strength; at least for today; at minimum.

Specifically, Enterprise/Cloud-space leader (
CRM) is breaking-out powerfully from a 3-month base; on volume running ~5x's normal pace. This is a major breakout of a an institutional leader. Given the calendar, if the market cooperates you can expect strong flows to continue for the remainder of the year (IF IF IF). The tremendous volume is suggestive of much more than any 1-day wonder and has implications on the overall Tech space. I recommend not over-thinking this or trying to get clever. I recommend respecting your leader.

I won't to speak to the market here, since a re-trenching macro bear would snuff the trajectory of any decent launch and I know too many are expecting a strong year-end for me to get cozy about it. But study CRM in the coming weeks and learn what an institutional darling looks like ahead of, during and after the launch.

Fortunately for me, I remain an idiot.
I added to CRM last night at the previous highs. But I wasn't enough of an idiot trying to buy it further in the opening minutes today. I have enough to be patient and I'm currently keen on adding towards 15%, within a couple percent of the previous 123.83 high (or ~125).

Pyramid your winners - blow out your losers. Easy game ;)

Follow Centrifugal to fade trades in real time

Total Position: Currently 2.74-to-1 net-long, 95% invested

Currently Long (according to size):
CRM (10.7%); NOV (increased today, 9%); COH (7.3%); ULTA (7.4%); SBUX (6.7%); NFLX (6.7%); ROSE (6.2%); LVS (Reloaded today, 6.1%); RVBD (5.4%); QLIK (5.2%); OVTI (3.2%)

Currently Short: NDX-as-hedge via $QID (reduced today, 9.9%); DISH (6.3%); GMCR (4.9%)
(currently weighting QID at 1.6 x's and not 2 x's, into the net-long calculation; based on relative beta of longs vs. qid)

Futures: no current position

No comments: