Wednesday, June 30, 2010

Updated Position (mkt-neutral, now smaller)

Culling back positions now, hedged with QID.

Total Position
: Currently 1-to-1 market-neutral; 51% invested

Currently Long (according to size): NFLX (10.1%); CRM (reduced today, 9.6%); EWS-Singapore (6.6%); SUN (5%)

Currently Short: QID-long (Nasdaq100 2x's-short, 19.6%)
Note: Inverse ETF currently weighted @1.6 x's

Futures: no current position

Follow Centrifugal to fade trades in real time.

Tuesday, June 29, 2010

Updated Position (neutral stance for now)

Tomorrow will be interesting.

The market correction is now confirmed, which probably means we'll rally some from here. That's how it's been lately and Genius doesn't come easy; there are too many of those around just now anyway, if you know what I mean.

Either way, selling strength probably makes the most sense right now; should we get it. I like several stocks still, but there is only so much up-stream these wooden legs can stomach. I've backed-off, but I'm upright still! neutral for the time being.

Follow Centrifugal to fade trades in real time.

Total Position
: Currently 1-to-1 market-neutral; 79% invested

Currently Long (according to size): CRM (11.4%); NFLX (10.5%); EWS-Singapore (6.6%); NTAP (5.1%); SUN (5%); LOGM (4.7%); ULTA (4.5%)

Currently Short: SDS-long (S&P500 2x's-short, 20.7%); QID-long (Nasdaq100 2x's-short, 10.6%)
Note: Inverse ETF currently weighted @1.6 x's

Futures: no current position

Tuesday, June 22, 2010

Updated Position (and sawing the branch on which I was sitting)

Tuesday dealt a step back here and in the end I was forced to back-off; shift towards defensive.

At the same time I am pleased with the re-risen chorus of warnings (over the market's fresh technical breach!), coincident with the still-juicy charts, of still too many names, atop a still too-low number of 52-week lows, and a general still-born faith we'll (James) garner any economic prowess any time soon.

If my read on this is right (and if not the lovely image below is backwards from my face), then prices and calendar dates should find a way to march leadership higher (again!), before these warnings find merit.

The chorus should be one of hope and promise before serious thrashings prevail again. Not that it's always the case, but again: when the long-only crowd is afraid to play, coincident with so many strong stocks on the tape, those leading stocks (if not all boats) should work their way higher, through all the resounding drama and chaos, until long-only loggerheads start searching the party for a clean cup.

Follow Centrifugal to fade trades in real time.

Total Position
: Currently ~1.84-to-1 net-long; 79% invested

Currently Long (according to size): CRM (11.4%); NFLX (increased today, 10.9%); EWS-Singapore (6.8%); SWN (6.2%); CISG (5%), AVGO (reduced today, 3.6%); ULTA (4.7%); CAVM (4.3%); LOGM (3.6%)

Currently Short: SDS-long (S&P500-short, reloaded today, 13.7%); DTV (4.9%); APOL (4.1%)
Note: Inverse ETF currently weighted @1.6 x's

Futures: no current position

-bear-trap brooch

Wednesday, June 16, 2010

Updated Position

Backed-off here some late yesterday, reducing in places and re-loading a slight hedge.

Twittspitt for trading details...

Total Position
: Currently ~4.93-to-1 net-long; 79% invested

Currently Long (according to size): CRM (8%); EWS-Singapore (6.8%); LULU (6.5%); AVGO (5.7%); NTAP (5.5%); ROSE (5.3%); SBUX (5.2%); ULTA (4.7%); AKAM (4.6%); PVH (4.6%); GIL (4.2%); SPRD (4.1%); CISG (3.6%)

Currently Short: SDS-long (S&P500-short, 6%); APOL (4.3%)
Note: Inverse ETF currently weighted @1.6 x's

Futures: no current position

Friday, June 11, 2010

Updated Position (pawning prudence)

We should all be happy now.

Leadership growth is right back to highs (again!) as it still requires but a hint of broad market upside to see these leaders arcade higher.

Bears can stay hungry, as the volume on this rally is quite low, GS and AAPL have both become laggards now, and of course - the world is still a sink-hole.

I'm personally happy, as it pleases me terrific when leadership is rising at the same time the buy-only crowd have talked themselves out of the arena (and in universal concert!). Frankly, the smarter folks who have been stabbing short do not impress me - I should expect as much. But for retail blow-hards who cannot swing short, the fact that they are adamant, conjoined and convinced they need to keep safe (fearful of coming out to play), when at the same time there are so many powerful stocks out there - such things keep my animal spirits palpably high.

I am easing on exposure today, however, after pushing back to >5-1 net-long yesterday. Even if it is the beginning of a real and tradable rally, it is still early, it requires confirmation (again!) and I can't go into the weekend with all powder employed arrogantly.

So, just as I've been told, universally for some time now, I'm getting smaller - taking a bit of risk off the table.

I might reduce further today, depending on the action. You've got to dodge bullets in a market like this :)

Total Position
: Currently ~3.4-to-1 net-long; 80% invested

Currently Long (according to size): EWS-Singapore (6.6%); CRM (6.2%); LULU (6.1%); AKAM (5.9%); AVGO (5.5%); ULTA (increased today, 5.4%); OIL (reduced today, 5.4%); NTAP (5.3%); SBUX (5.1%); EWY-S.Korea (4.2%); GIL (4.1%); CSTR (3.8%); CISG (3.5%)

Currently Short: EPV-long (Europe Dbl-short, 5.4%); APOL (4.5%); QID-long (NDX Index Dbl-short, 3.9%)
Note: Inverse ETFs currently weighted @1.6 x's

Futures: no current position

Twittspitt for details

Tuesday, June 08, 2010

Front Pocket Rocket (ready-list of live longs)

While we're all waiting for a plunder-plunge below 1040, I thought it time to line up my list of leading aggressive growth.

Don't do what I do, but I do like stocks which resist the down-side pressure and then pop towards their highs every time the market manages to rally. Except for the Energy and Chinese groups, these names hail from current high-rated relative-strength industry groups.

In it's own class:

Cloud Computing and Cloud-Related:
APKT (edited onto list 9 Jun)
ULTI (added 13 Jun)
ARBA (added 13 Jun)
LOGM (thin, added 13 Jun)
CAVM (added 13 Jun)
RHT (added 17 Jun)
CVLT (added 17 Jun)
NETL (added 7 Jul)

Other Tech:
AAPL (removed 30Jun)
ARMH (added 13 Jun)
OPEN (added 18 Jun)

COH (added 10 Jun)
CSTR (added 10 Jun)
UA (added 13 Jun)
ROST (added 13 Jun)
TJX (added 13 Jun)
URBN (added 13 Jun)
ARO (added 13 Jun)
SKX (added 13 Jun)
AZO (added 23 Jun)
ORLY (added 23 Jun)
VSI (added 25 Jun)

Generic Drugs:

Chinese Growth:
CISG (thin)
CTRP (removed 7 Jul)

IOC (added 13 Jun)
VQ (added 13 Jun)
ROSE (added 13 Jun)
WLL (added 13 Jun)
PSE (thin, added 13 Jun)

Sunday, June 06, 2010

A Trader's Guide to Courage (and the first bullish rant here in some months)

Unfortunately, I no longer remain an idiot.

Friday was not the butterfly punch I was defending for, not by the end of the session. I’ve been forced to play some defense.

Still, I’m scavenging observations, thoughts and plots and preparing for when this trampoline next springs in the upward direction; whether that comes with an up-open on Monday or we drop like hell to get things started (or ended!).

I am excited still and I remain in a manic phase. Saliva was flowing freely this weekend, as I brought out the Polyester, woven-Pavlovian, harpooned Woot Suit; saved specifically for high-seas action.

I come to you now, a rarity these days, seething. I’m not out of my head professionally, but it is always important to keep the head in mind; in such a state. I’m using this now as a device, speaking to you. A kind of social interlude, which acts as defense and works to keep myself in-line. I can rant here, peacefully and without consequence (you see I have very little readership) and get the ‘fuck-you, I'm trading it this way’ attitude rooted out of my system. So you see, you are important to me reader, just as everything with energy, in my manic state, is important to me now; for my trading survival. If you disagree with my arguments (you are correct, I’ve offered no bullish arguments yet), you might keep reading anyway. If you disagree - all the better! I need that. I need to know that someone's lunch is on the table besides my own. I hate to be in the chorus, when the chorus is gloomy, and at a time I see winning stocks resisting going down as forces conspire against them and then pop right to highs again as forces subside...if you know what I mean.

Yes, yes, yes, one has to respect the potential downside here. A must, since, well, being (an idiot right now) blind to selling forces when they begin to pick up a certain steam, well that leads to head-loss eventually. No matter just now, what I might think.

So courage aside (bloody courage!), I am forced to be more neutral; if only this moment, I don’t yet know. I am more neutral because burning feet is fine when strolling coals - but losing my head en-masse is not a fate I’ll allow myself to dare. My head stays here. As rabid and crazed as I may presently exist, I will see that my headpan continues on. Let them carry me out of here one day for not being able to hold my own fluids. They will not carry me out because I blew up in a bloody pulp of courage.

You see now why I am so trusted by clientele (ha!). They read this and can be assured, while I am apparently willing to risk their better opinions of me, as a rational and well-adjusted man, they can at least know I will die in a fantastic spasm before they’re under-performing this marketplace.

You however, are not likely my client. And that makes you the enemy as far as trading goes. Certainly, it is a big pool, it is an ocean of funds out there and the chance that your shares and mine directly cross are absolutely tiny. Still, I think of you now as an enemy, respectfully, and I want to take the other side of your trade at the most opportune time; assuming you and I are in such co-operation. Again, this is not personal, but you should know I intend to leave a trail of dead kittens when I am through with you. There is money to be had! Some of it yours, perhaps.

Let’s return to courage a moment (courage is a word a crazy man pulls when describing himself). In and of itself courage is great and I respect a trader with courage; since it is an essential ingredient to success. But I've learned the hard way I have a bit of this courage (bit in half!). That's more of a confession than anything like bragging - since in trading markets courage on it's own leads to disaster. Indeed, like jumping off tall buildings (perfectly possible these days), running across railway tracks (kid stuff, but can you justify the risk/reward?), spear fishing Great Whites (oh such fun, but a nasty hobby at times), etc. etc. etc...courage can be a killer!

Therefore, assuming one is thumbing his nose at the present, larger trend (as I am!), one cannot expect to never get knocked, but he must insist on balance, patience and respect, for a very long time on occasion - until he can see he’s no longer fighting the larger force, but only thoughtful traders like you!

Yes, I have not changed my bullish (deaf)tone. We are near the end of the quarter and there are leadership stocks showing amazing resiliency and I know how those months tend to conclude. Yes, yes, yes, there is plenty for my bull blood to boil over (I might even get to that). And look, if everyone were universally negative here, and I could measure that vs. the overall larger sucking action out there just now, well then I would be jamming short - I assure you! But that is so far from the case. I am getting warnings, nearly universal warnings to keep myself safe from such unsavory waters and from people who generally never see a good reason to sell stocks, indeed - have never sold stocks for good reasons, but now suddenly see fit to convince themselves that there are just too few positives to possibly drive the markets higher over time anymore. That somehow, the long-term just doesn't look so promising - that there is something, well, uncertain!

Yes, welcome to Planet Earth and thank you for the Mesozoic Memo Dr. Welby! We can no longer buy-and-hold simply and fall asleep for 40 years? There is a question mark now on the long term investing dynamic?

Whoa now.

I will admit, there is a tendency to shout louder and more passionately when the market is going against you - when going against the grainy good and suffering blows as a result of it. And I am shouting passionately (my l'esprit de spite, I suppose). But the market is closed just now, so I am free to shout; I am safe. It has always been this way for me. I can control it best, off-time and away from the market, and by using you to deplete it. I would even apologize for using you so, but you have come this far down the page and on your own, so it is your fault entirely! I’m simply preparing for another week of battle. I am free to say anything at all, this early and on a Sunday. Because I will run like hell if the executioner comes for me on Monday.

That's it, unfortunately. I've used what energy I have for you and haven't the energy now to categorize the bullish positives, or hit-list the livelier longs. I might get to it (ha!), but the sun shines now and even pleasantly. The negatives are ripe, as you know. The biggest market in the world is the currency market and the Euro is on a direct path towards par; this, we know so well. There are not even 100 new 52-week lows on US exchanges during the negative chop on Friday, but this should not be important. There are monster stocks (I did refer to that much) right now, coincident with a venerable plea to get yourselves under-invested, "take risk off the table," and change your sheets a little more regularly right now. The NDX, a leading index, is considerably above the Feb-lows while the SP500 and Dow look like they will jig-down below such levels, before we can gauge whether or not they might then return. I have a new CNBC friend, replacing Trish who has become very disappointing to me since returning from maternity leave, but I cannot get into any of this just now so I'll stop teasing; and point you to the under-investment corner - that's where you and all the rest of the investing universe belong now - safe safe safe. Bah!

This remains an interesting time in the market.

Friday, June 04, 2010

The Grizzly Chewed His Arm

Butterfly Punch?

Interesting session today.

First, let's get this out of the way - the chorus of shouts to sell this jobs report can claim big smarts as the day turned out to be a rout. That's great for them, but somehow no disaster (yet!) for me as well. Fine, because given the incredible action in leadership this week I am only too willing to lose money today in order to go with the market instead of the LOGIC. Seeing my head still on my shoulders, I know I stood to make much more than I was risking; a bet I'll wager every time when everyone (and their Fast Money mother) was warning what I'd get hit with.


Anyhow, in the heat of the rout, leadership still shows amazing resilience. If you don't notice it, because the negatives are so compelling - that's totally your prerogative. I won't argue. Get defensive because of the risk. Get UNDER-INVESTED in fact.

Get in the corner and wait wait wait so I can eat your lunch with what's left this quarter. Sooner or later one of us will run to the other side. I wish you well.

Anyway, realistically, I try to react and adjust, but as of yet I cannot turn negative here. There are just too many great charts right now (more today than last Friday) and the overall market is not at lower-lows. We should be acting more like the Euro for one, I should be able to pick up a NFLX under 90 secondly and we should see a few more than 50! new 52-wk lows mid-day in a rout.

If you want me in your corner.

The Euro is at a lower-low, Hungary CDS prices blew up, France is in the cross-hairs now and Spain remains the next untied shoe to drop. Plenty for bears to buzz about.

How do I deal with it all? Well, I'm eating freshly born Lassy pups just now, while determining whether and where to further hedge (certainly happy about having accumulated yesterday's EPV) and when and where to add leadership. I don't want to add retail before the close (LULU looks lovely), since that group is affected by payrolls and are universally smacked today. Semi's are also universally down, so I'll leave that alone. Financials are universally lower, except for GS, which is interesting. Energy, however, is closer to mixed today and increasing weight there at mid-day is not necessarily out of the question.

One should note the resilience now of crude oil, relative to the Euro. Oil cannot so far manage even a 2-day low, while the Euro plays sandbox with 1.20.

And then there is the Cloudbox sector of CRM and VMW + AKAM, NTAP and a couple of others. What do I need to say about this group? They're puffy and lofty - no wonder they only go up!

Yeah yeah, I gotta go. Fast Money geniuses are coming on now - hopefully to warn me further. I won't predict, but I won't be comfortable if they suddenly start spreeching about this as a buying opp.

Until then I see no reason to get too emotional. The kitchen sink has been thrown at my head now and I have taken but a scratch (the day is young still). Yet, I've been as long recently as I've been since last spring; somehow accounts remain up big this week.

That may change. The CRM's might get clouded late this session as a universal margin call implodes anything with a bid.

Fine - Prove it and I'll believe it!

[No time to update positions, but still >3-1 net-long, down from 5.7-1 last night and 20-1 the previous night. Picked-up some DXD for hedge after the jobs report fell-swooped; Removed JPM long; reloaded OIL long and reloaded an additional trading tranche of CRM]

Thursday, June 03, 2010

Wall of Worry (floor of hurry)

CNBC's Fast Money tells us the market will sell-off tomorrow whether the employment report is better than expected or worse. There were some nice, thought-out and logical reasons as to why.

Fortunately for me, I remain an idiot...

Total Position: Currently 5.7-to-1 net-long; 92% invested

Currently Long (according to size): JPM (6.5%); EWS-Singapore (6.5%); CRM (increased+traded today, 6.1%); IOC (5.8%); AKAM (5.7%); AVGO (5.5%); OVTI (5.3%); NTAP (5.2%); TGT (reduced today, 5.1%); SBUX (reduced today, 5%); CTXS (new today, 5%); ULTA (reduced today+news tonight, 4.6%); EWY-S.Korea (4.2%); GIL (4.2%); FFIV (3.8%); CISG (3.4%)

Currently Short
: EPV-long (European Mkts Dbl-short, re-entered early today, 6.8%); APOL (3.5%)...
Note: Inverse ETF currently weighted @1.6 x's (based on relation to relative beta in long holdings)

Futures: no current position (in and out of Crude Oil and Russell2k longs last two sessions)

Twittspitt for details

Wednesday, June 02, 2010

Clarion Coil (my head - your lunch)

Pushing rather long here at the moment, though I will scramble again to hedge if the skies re-darken. This, until the action in the market can outpace the prevailing darker mood.

Or put another way - the market has still managed to hold above Feb-lows, even with the BP travesty throwing the energy sector to the wolves; and coincident to participants now looking lower lower lower instead of viewing anything like opportunity. These are the same folks who saw no wrong with the market a couple months back and claimed that pullbacks would be clear buying opportunities.

Think about that briefly - numb-heads wanted to buy a pull-back; we got a pullback which, for no lack of drama, has not taken the market below the last pullback in February (just a few months ago); now however, these same saps (my technical term for heads I have to listen to throughout the day) view the market as somehow toxic and are largely sitting on hands instead of buying.

At the same time, market leadership remains strong on the tape, the crash in a chunk of the energy sector (which holds a sizable weighting in the SP500) has not generated overall lower-lows, and last and perhaps least - bear blogs were in a high-five fervor again last night; celebrating the beginning of the never-ending end - Part Doo.

Given this is the last month of a quarter, and professional managers allocate professional dollars (much of which is recently liquidated from the bail-out in the energy stocks), I expect leadership will fare very well as long as the market can surprise these dull spirits (and my clients!) and keep from lower-lows; or simply, rally for the month of June. I consider that a likelihood in fact - although I don't care what I think as much as what kind of bang I am getting for bucking conventional wisdom...I need to be on the right side, not right in and of itself. That's right, I'm rambling incessant just now - surely you can short this!

This month still looks promising to these eyes and not because I prefer abuse. Show me lower-lows and I'll do what I can to adjust. In the meantime, leave me to make some money. We've seen a bull market in fear lately (perhaps the recollection of being flayed has awakened the collective spirit to waking up mid-sleep, sweat cold and minds racing; out-weighing anything like greed).

This, while we still have not managed to take out Feb-lows.

If I am the fool here, very well. I am not trying to be right or even particularly clever. I simply measure what I see (and hear!) relative to the action in front of me. And, there are moments such as now where the action (energy debacles aside) far out-performs the noise.

This is not to say that a roaring bull market is at hand. I don't care to measure it in advance. But anything is possible and given everything...a rally this month is only likely by my standards. After that, what should I know? I don't care if it's only long as I can squeeze 10.

Beast out

Total Position: Currently ~20-to-1 net-long; 73% invested

Currently Long (according to size): JPM (6.5%); TGT (6.4%); EWS-Singapore (6.4%); SBUX (6.3%); AVGO (5.2%); ULTA (5.5%); CRM (5.1%); OVTI (5%); AKAM (4.3%); EWY-S.Korea (4.2%); IOC (reloaded today, 4.2%); GIL (added today, 4%); FFIV (added today, 3.7%); CISG (3.2%)

Currently Short: APOL (3.4%)

Futures: no current position

Twittspit for details