Bear Market for Bears

Life is tough for bears again today, as the ridiculous market rally takes them once more by the horns and runs with it.

Bears remain right, heads and shoulder patterns above the rest. I mean, we've moved too-far-too-fast, well, too-far and too-fast. The market must be rallying out of spite at this point. Anyone in their right mind knows it's completely unreasonable. Lives will surely be taken now and soon.

Fortunately, I remain an idiot.

One bone-fide negative divergence - the Dow is leading the major indices higher. The Nasdaq, NDX and Russell-2k have yet to make higher-highs along with the Dow. The broader NYSE has managed a marginal higher-high, but you don't like to see Jonestown leading a charge higher; especially should the NDX and Nasdaq turn down at lower-highs.

Fine. In the time it took me to write, link and edit the previous paragraph, all but the Russell-2k have traded now to marginal higher-highs. If the market reverses lower today, it will qualify as something ugly (something like a doomed house head and shoulder head fake) - which would indeed force me to adjust.

In the meantime, Chinese growth names traded in the U.S. continue to lead (leading even those Dow Jones's) in the U.S. and I have to answer as to why I have any hedge on at all just now.

Bah!

-Total Position: ~1.75-to-1 net-long, considering levered TWM hedge
-67% invested overall
-Pure-longs = 52%

Currently Long (according to size): ASIA (7.4%), HMIN (7%), HRBN (7%), WATG (6.2%), DGW (5.3%), RKT (5.1%), CFSG (5.1%), CLW (4.5%), ININ (4.5%)

Currently Short (according to size):
-TWM-long (Russell 2k Dbl-short, reloaded today, 14.8%)

Futures Accounts: no current position

At Gravity's End

The question on the Street is evolving now to whether we'll hold and close above Dow 10,000 (that important psychological milestone), or will we see something resembling a pull-back.

I need a new career - more certain than ever now I'm very likely, definitely doomed. My only hope is Trish is off the air when 10k is hit. I'll likely be forced to sell everything if not.

Internals are strongly positive, but not severe today. INTC, JPM and Dow 10k hats are dominating the headlines, but it is the Chinese ADR's which continue dominating leadership growth.

Security software provider Asiainfo (ASIA) is the latest big breakout. ASIA is doing major volume, breaking out of a roughly 6-month base.

I like this thin name Harbin Electric (HRBN) perhaps most. This is the stock that broke out on the news they were buying another company (an accretive deal; I do like breakouts where the catalyst is driven on buying another company).

RINO (Rino International) is the exception today, but that stock was extended beyond extended, so I'm not ready to call an end to the Chinese growth-stock surge just yet. I unloaded the RINO position at the open today (>27). I will likely lay-off now at least until they price the upcoming secondary.

I don't want to speak more than that, sorry. Good luck with your shorts.

-Total Position: 100% net-long
-60% invested overall
-Pure-longs = 60%

Currently Long (according to size): RKT (7.1%), DGW (7%), HRBN (7%), CFSG (6.4%), ASIA (6.2%, going on 7%), HMIN (6.1%), ULTA (5.1%), CLW (4.2%), SWM (4%), PTI (4%), CHBT (3.6%)

Currently Short (according to size): no current position

Futures Accounts: no current position