After a second day of gains, I was forced to lay-off shorting the (commodities-related) material's and energy stocks. Actually, I went long these yesterday for a nice counter-move, but I got hit in the face with a frying pan when they reversed higher today and I was again short.
I love fading one-day-wonder rallies of broken stocks and/or groups and if I see blood the next morning, I really like to dig-in and get medieval - if they'll let me.
They let me - I got middle evil - and I was, well, dug-into.
Market breadth was extremely negative after the first 90 minutes of the session (something which grants me the authority to widen stops if I am inclined to hold my position) and breadth stayed very-negative as segments of the market started rallying. Only after 2/3rds of a session of hard knocks did I give up and move aside.
Fine. Whatever. I'm still alive and willing even to go long here if the market keeps firm; whether a more medieval splash, by getting long Retail and Homebuilders, or something more state of the art (ala, the latest cancer cures and phlegm-stoppers). We'll see when we get there, but I'm pretty sure it won't entail building a portfolio of material's, energy's and other commodity-type themes; let Monty make the money right now going long those groups.
Is there a serious turnaround developing in the overall market? My sense is probably yes but it's too early, and I don't like the idea of accumulating names for more than a day just yet. I'll stick to the quick-trade prospects (long or short) in this environment. But in the meantime I'm building (long-side) lists of stocks and groups demonstrating leadership in this environment.
Some new and obvious (you didn't know?) industry groups which are showing leadership are:
-Retail (incl. Discount, Clothing/Shoe, Home Furnishings, Drugstores and Misc.)
-Medical (incl. Genetics, Biomed, Medical/Dental Services and Products)
-Transports (incl. Airline, Rail and Truck)
-Commercial Svcs-Schools (zzzzzzz)
-Building-Residential/Commercial
Yes, homebuilders are acting very well this week, as mortgage rates have dropped considerably following the US take-under of FRE and FNM.
Individual names may or may not be posted here soon. It basically depends on whether the market can continue to rally or not (the leadership in the market is not exactly awe-inspiring at this point either).
Thus (thrust!), if we can resume the direction downward instead, I'd be happier than Satan at a speaking-in-tongues convention just to again pull-out my Death Spiral Shortlist.
...for new-times sake.
No comments:
Post a Comment