Friday, November 6, 2009

Bookkeeping: Making Some Long Purchases

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Now that the 2 big news events of the week are out of the way, and thus far the drop below the 50 day moving average looks just like it did in July 2009 - that is, a headfake I'll get back some longs.  I am surprised it is just that easy... we had 5 intraday reversals in 9 sessions during this selloff; in the past that would mean very bad things.  But its a new paradigm of easy money I guess.

All the below are stocks that broke back above key resistance areas or never broke down below during this selloff; therefore I can place tight stops and not take too much damage if this is just a head fake.  Until that Russell 2000 resistance is broken, which represents the smaller and mid cap names rather than just the typical names people run up on every rally (Google, Apple, Goldman, blah blha), I'm still wary.  For you technical folk this could be a "head and shoulders" set up on the S&P 500...(bearish)  If so we are in the process of forming the right shoulder.

Example chart I am buying:




I added back to our current names:
  • 1% exposure to Gafisa (GFA)
  • 1% exposure to Blackstone Group (BX)
  • 1.25% exposure to Atheros Communications (ATHR) 
  • 0.5% exposure to AsiaInfo Holdings (ASIA)
If the market rolls over and/or these stocks fall again below key moving averages, we'll be right back out.  For now I hold my nose and buy a little.  Still massive amounts of cash.


Long all names mentioned in fund; no personal position

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