Back to S&P 1490

Well here we are again. Back to our old stomping grounds in just 4 sessions. What a rally.

Today, as I look around, it appears the speculative juices are back - or are they? What is going up the most. The beaten down speculative type of stocks... but is is buying or simply short covering. I am using as bellweathers the solar sector and the 'teflon stocks' in tech - the more speculative names are up in solar whereas the leaders are just up a bit. And the teflon stocks are ranging from down (Research in Motion) to barely up (Apple, Google)

So to get behind a rally from this point of view, I'd like to see those leaders move up... not the 'speculation' stocks. Leadership areas like coal are also weak.

Very strange to see silver and gold so weak today... hmm.... can't figure that one out - you'd think interest rate cuts would be helping those names - that was why I bought Silver Wheaton (SLW) - that theory does not seem to be working out.

I am continuing to sell (trims, not major selloffs) and raise cash - positions lightened: Ciena (CIEN), Chicago Bridge & Iron (CBI), Sterlite Industries (SLT) [again! what a day, up +15%], New Oriental Education (EDU), Foster Wheeler (FWLT), Jacobs Engineering (JEC)

The stuff at the top end of my fund, what I would consider more stable names are just up slightly, whereas the stocks I have much lower exposure to which are more of the high risk/high reward types are flying. Interesting dichotomy and again, appears to me at this point to be a short covering situation. It does not mean performance anxiety won't lead people back into this market as we go to a Santa Claus phase but I'd like to see confirmation before I go there.

All in all, I've liquidated about 5%+ in equities, so cash is up to 19% and I've added to some UltraShorts. As I stated in the plan yesterday, if we break out in the S&P 500, past those resistance levels, than I get more constructive and ignore all macro economic issues and return to punch bowl drunken orgy like everyone else. Until then, staying neutral.

Long all names above in fund; long Foster Wheeler in personal account