Thursday, October 7, 2010

Bookkeeping: Short Prudential Financial (PRU), Shanda International (SNDA), China Automotive Systems (CAAS)

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I am rebuilding some individual short positions - almost all of these have been failures for 6 weeks in a row on the non stop melt up.   These are completely for technical reasons.  If we gap up tomorrow morning on 'better than expected' labor data - especially if we hit S&P 1170 - I'll be shorting against the index.  (I'll be curious to see if government jobs spike due to that NYPost story I noted recently re: poll workers having to file with IRS for first time ever)  But for now just individual stocks.

One thing I am noticing as I screened for names is how little volume is in so many of these mid cap stocks - everything in this market is so dependent on the ETFs or a narrow group of momo names, a lot of these stocks that even 12, 24, 36 months ago were full of retail traders seemingly have been abandoned.   In 2007 these Chinese stocks (I picked two popular ones) used to be full of retail traders... you can truly see the fleeing of the stock market by the individual when you scan through so many of these names with little participation.  They now are lucky to get a few hundred thousand shares a day traded.  Now I see why everyone is crowded in the same ole names like Netflix and Apple - there is so little liquidity everywhere else. I had a few other candidates for this entry, but had to abandon them because they are barely trading anymore.

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Prudential Financial (PRU) broke support a week ago, and now has rallied back to resistance.  This is either a 'break over' or not trade with obvious stop loss.  Shorting 2% just under $54.



Chinese gaming stock Shanda Interactive (SNDA) has rallied back to its 50 day moving average - that is my pivot point.  Shorting 2% allocation around $39.30.  A move over $40.25 or so, and I'll be out.


China Automotive Systems (CAAS) - identical to Prudential - it will either break over resistance or not.  2% allocation, with stop over the green line.




Short all names mentioned but Netflix, Apple in fund; no personal position

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