Tuesday, June 23, 2009

Bookkeeping: Stopped in More Stocks and Covering Darden Restaurants (DRI)

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I did not realize Darden Restaurants (DRI) reports this week so I am going to cover my short ahead of that event; much like I don't bet on the long side ahead of an earnings, I won't do the same on the short side. I am going to take a moderate gain of a 2% as I exit at $33.60ish. The chart still supports a short but while many names on my watch lists fell 5-10-15% yesterday Darden of course held up well :)

A stop in Longtop Financial (LFT) was hit this morning; again I might be shaken out and the stock reverses up but I placed my stop and if it hits, it hits. I lost about 80% of my position at $24.50. Current price is $23.90 but as we discussed last week this is one volatile name.


As for the general market, this "2 chart" condition is still causing all sorts of headwinds. On the "simple" moving average chart both the 50 and 200 day are now converged ... at S&P 900. Bulls want to see the market get over that number and hold. On the "exponential" moving average, S&P 894 is the 50 day moving average which provided the bottom yesterday and thus far this morning.

EXP


SIMPLE


Again, it is very strange having to deal with 2 charts telling such different stories. I have no clear idea where to position in between S&P 894 and 900. Until I see us break out of that 6 point range I'll wait. I did cover an index short I put on yesterday in the S&P 894-895 range this morning, due to the 50 day exponential moving average sitting there as support. If we break below that I'll get that position back as I believe we head to S&P 880. If we get north of 900, I'll add long exposure...

I am sitting at my highest cash exposure since we started in August 2007 pending this next move.

Long Longtop Financial Technologies in fund; no personal position

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