Monday, July 7, 2008

Bookkeeping: Cutting some Fertilizer Exposure

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Cutting 3 of the 4 fertilizer names here as they potentially break down. Historically you want to buy them when they touch the 50 day moving average since they bounce, but with the market acting so poorly we could get some washout action. Mosaic (MOS) for example *STILL* has a gap in its chart around $110 that I've been eyeing for an entire quarter. (currently just under $130) Just from history when there is real panic these names drop 10-15% in 1 day. See August 07, see January 08, see March 08. I'd like to buy these portions back in a panic sell.

Cutting about 15-20%ish position in Potash (POT), CF Industries (CF), and Mosaic (MOS)

I was unable to log in this morning but that spike, once clear it was unable to breach S&P 1275 (old support, now resistance), would of been great to fade with some index shorts and Ultrashort Oil - Gas (DUG). Even though I did not get the prices I wanted this AM, I added them here in the last 30 minutes.

The best thing for this market would be to see the type of selling we saw in coal last Wednesday in all the natural gas and oil names. They still have not seen any major pain. The last foxhole to smoke out. The action in financials is simply troubling - Fannie Mae (FNM) is a disaster.

The last times the market bottomed the fund was down 7-8%ish intraday (and yes I was feeling sick at those moments) before recovering/reversing by the end of the day. So I'm "all in" for now on the long side and won't be purchasing long positions until we get a similar moment. The bounces over the past 6 weeks have been so pathetic it is embarrassing for the bulls. S&P 1260 is now clearly broken and as we said, S&P 1225 is the next stop (current 1240s) If that breaks S&P 1170s is in the cards. I'll be an active buyer at 1170 if and when....

Long all names mentioned in fund; long Mosaic, Ultrashort Oil-Gas in personal account

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