One could argue this is the beginning of a new move up in commodities or natural gas. Perhaps. I don't know. But we can always purchase later when the stocks are in a firmer uptrend. For XTO it is pretty clear - north of $56 would signify a good thing - we have multiple resistance levels at $54 (50 day) and $56 (200 day moving averages). So we'll close this out for now and if this move is more than Gustavo related and lasts past the middle of next week, we'll rethink this. It is impossible to game what HAL 9000 and his friends will be doing next week or the next few weeks. For now, I'm happy to be out flat and we can think with a clear mind and no past baggage what we want to do going forward. We still have our coal and fertilizer exposure if the "global growth/commodity" trade is back in vogue by the quant hedge funds in the coming weeks. I have my doubts.
I'm continuing on the assumption that in this market breakDOWNs are to be bought and breakOUTs are to be sold. This has worked in 75-80% of the cases of late, and while nothing works all the time, it seems to be the current flavor of the day.
No position
2 comments:
Hey Mark,
Quiet day.... I was looking at some of the coal stocks (aci, btu, anr, wlt). The charts seems still very good. Maybe they are ready to move.
Yes I was hoping coal and fertilizer will begin to disassociate from the oil / nat gas trade
some of the coals look ok. ANR is sort of hostage to the buyout - if it starts to move up then we know the deal is on.
It is just hard for me to trust any strength because we have these 180 degree reversal days where what is good today is sold tomorrow. When that happens on a weekly basis you lose the urge to buy anything.
I'm not really chasing anything and simply selling into strength. I don't trust these moves to last, and if I'm wrong that's ok. Too many whipsaws of late - I'm going to pick spots carefully and in small pieces. The action is too random to trust in my opinion.
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