A close call but we just broke below S&P 500 level 1320. As I've stated I am looking at 1315 or so, and if we break there I'll be pushing much of my 25% cash into the short side, expecting a retest of January lows (S&P 1270). Again, a very important inflection point and as I've been saying for a few weeks, the longer the "range" the stronger the "break" out of that range, whether up or down. I've been betting the break will be down, and we appear close to confirming this. If it happens it should be a powerful move. A few more points to go for me to feel comfortable that hope will be lost and Kool Aid will be on the side of a carton of milk momentarily.
Finger on the trigger... again, if 1315 is broken I'll be buying in spades my 6 Ultrashorts.
Finger on the trigger... again, if 1315 is broken I'll be buying in spades my 6 Ultrashorts.
EDIT 11:10 AM - S&P 1313 and this appears to be the start of a breakdown in my eyes; moved about 12% from cash to Ultrashorts. For those following along at home, all I am doing now is buying back the short exposure I threw overboard Friday during the 300+ down day, and yesterday. I am paying a bit more, but this was the game plan so I am now following through. At this point I take a more defensive stance, until/unless we make a bounce back to S&P 1330+. As for buying, I am not really going to be interested until S&P 1270. Still a very tricky area because every computer on Wall Street is probably set to the same algorithim, so this could simply be a push down to set off a bunch of panic buttons and then they take the market straight up. :) I'll remain in cautious stance either way.
9 comments:
Hey Mark,
Have you heard anything about an emergency FED meeting yesterday? I got that from one of the blogs I read. Though I can't picture them doing anything until after the jobs number this Friday. Whatever they are planning, I wouldn't see any point in them throwing any good news at the market only to be swallowed by up a bad jobs number. And in this market of short term memories, the latest type of news wins.
1200, here we come.
1300 on the S&P and 12000 on the DJIA are important psychological levels from a purely "round numbers" standpoint. I think we need another "shoe to drop" (as Mark says) to push us through those levels.
T-radar,
First it was a normal meeting they always have. People grasp at anything... p.s. so what if they cut rates 3 weeks early. Will that change anything? Nothing at all.
Second, you should not read any other blogs - stop cheating
Sheng, if we break 1270, 1200 is very possible
Brian, I also believe in the round number theory and 1300 will provide some support but I doubt much. That said, its pretty negative out there and it's about time for Charlie G to break out the old Ambac rumor news ... or will we wait to SP 1270 for that "breaking news"? ;)
I think there is more than enough news out there... what has to happen is people realize that for any US company tied to the consumer that 2008 estimates are a hoax - people call this market cheap simply due to 08 estimates. Which will be falling as we go through the year. I read yesterday that Q4 2008 is estimated as 51% improvement from Q1 - laughable! But it ties into the "hey everything will be fine in 6 months" theory.
Early, surprise, unexpected, etc... yes the FED cuts don't change anything but it adds more sugar to the Kool Aid. Also I was expecting something different, perhaps some PPT led bailout of the bond insurers that will be announced soon (for real this time).
And once again on cue, helicopter Ben has made a career of killing my short positions. I'm sure Ben has something to do with this latest rally.
Also I also have a small request. Would it be possible to have another set of "newer posts" and "older posts" links on the top of the postings section? Having to scroll down all the way to the bottom every time is starting to get annoying :)
It appears todays rally was the upteempth rally on bond insurer bailout. I feel bad for Charlie G, somehow I think he is being used... i.e. hey someone call Charlie and tell him the banks are close to an agreement, the market is tanking! Hurry!
I don't understand your last part of the comment, can you show me an example in another blog of what you mean? Do you mean the archive is too low on the page?
oops, nevermind, I see what you mean - the newer and older posts links at the bottom of the middle of the page. That is something set up by blogger.com so I will see if there is a way to change that but if its highly technical, the short answer will be no. I am not a html coding guru. I'll check to see if there is some quick way to do it though.
They should make Charlie an honorary member of the PPT. Heck they should make him the FED chairman. He wouldn't even have to cut rates or talk about monetary policy and inflation. They can just have him come out and say "bond insurer" and "bailout" in the same sentence every time the market looks like its going to tank. Inflation problem solved!! (This is just rhetoric on my part)
If you can't get this link issue fixed then I will have no choice but to see other bloggers :)
I did look into the set up page on blogger and it doesnt even show the "old posts" and "new posts" on the bottom of center area i.e. I could not even move it if I wanted because it doesnt show the option.
If you have another blog who uses blogger.com (most urls will be something.blogspot.com) and has the links at the top send me a message and I'll go ask them how they put it at the top. It must involve coding into the template itself so thats beyond me but if its something I could mimic I could ask.
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