Comments on Fund My Mutual Fund: A Great Post from Rev Shark over at Realmoney.com

Too much dogma in his work is all I am saying. Tr...

2008-04-18T14:43:00.000-04:00

Too much dogma in his work is all I am saying. Trend following works but you have to stay with the trend and I think most people don't do that....they trade themselves out of the trend never to get back in.

Functioning in the markets is very difficult to do and it is my belief that few things work all the time. What does work is this: 1) have a strategy; 2) diversify into non-correlated assets; 3) normalize risk across those assets.

The dollar is looking bullish to me, actually. I ...

2008-04-18T14:09:00.000-04:00

The dollar is looking bullish to me, actually. I was just looking at the technicals at it. It is in a rather nice looking bull wedge and looks like it wants out, to the upside. Even another move down from here, looks like it would set up some positive divergence, which would make technicians buy on a dip. Gold also looks like it is pricing a move in the dollar. I was even considering shorting it, as a hedge against my other commodities, but having cut back there, i no longer see the need. I still have no idea how you watch so much stuff. I consider myself getting 'portfolio creep' when I get over 10 positions.

Guy lolI take it your are not a fan! I like his w...

2008-04-18T14:03:00.000-04:00

Guy lol

I take it your are not a fan! I like his writings :) He is a trend trader so maybe that is why I like his writings. For his style (and mine) the past 4 months have been hard because no trend lasts more than 3 days (up until April 1 at least) - for daytraders it is fine but he (like me) likes to build up a position and add to on strength etc. Follow a trend. Thats been a successful method for most of the past 5 years, but you have to adapt to any environment. So I think all he was saying is "that style" trails on a day or period like now.

p.s. he is actually accurate on the serial bottom callers - that site has people who have been calling a bottom for months on end and they are so far underwater (if they did not have stop loss) that even days like today only gets them back part of their losses. You have to agree that his idea to stay in cash for much of the year has been a good one.

Anyhow, I'll agree to disagree with you on him - if you write for 5+ years you will become repetitious to some degree but he says things that run counterintuitive to the junk you hear from investment professionals i.e. just buy and hold, constantly average down, dont worry about losing 30% due to our advice, just keep buying. So I like that part of what he says - most of Wall St is just a ploy to acquire assets - and they sell you to just stay the course and never adjust so they can continue to acquire your assets - he calls people out on that, so I like that!

TraderMark: Having written for RM for several year...

2008-04-18T13:56:00.000-04:00

TraderMark: Having written for RM for several years, you can almost predict what RevShark would write on a day like today. It has been the same drone that he has written for years. Let's face it the markets don't trend all the time and it is probably strongly bullish only 40-50% of the time. Having said that each index behaves differently. If you were to trade the indices as I do, you are best buying weakness in the SP500 and selling strength; the NAS and Russell 2000 trend much better. You cannot categorically call the market difficult or unreasonable when you are sitting on the sidelines waiting to get to the punchbowl.

RevShark talks about the current trading being difficult for technicians...I wonder how he knows such things. Did he interview every technician out there? RevShark is very subjective; his analysis has no basis in objectivity whatsoever and therefore, it is of little value. He talks about buying "good sectors" and "good charts" but I would ask him: how do you define a good chart or strong sector? I am sure he would say that a sector "breaking out" (which he and most technicians never define) is a strong sector; but I would counter that not all sectors behave in such a manner. The SOX is a better short at highs following a breakout. Do your research!!

Lastly, if RevShark doesn't like the market then I guess that he should bet against it.

Well I'll be interested to see how the dollar does...

2008-04-18T13:52:00.000-04:00

Well I'll be interested to see how the dollar does early next week - everyone is claiming oil is only up due to the dollar. If the dollar strengthens AND oil goes up we have major issues :)

I also cut back on this group and frankly wont be adding more here - it is now as extended as the fertilizer stocks. This is now the area for pure momentum traders, buy high sell to the greater fool.

I still have some NOV/ATW/DO/CLB but will wait for pullbacks. Same with nat gas.

With restaurants they can just say inflation goes away in 6 months so dont you worry ;)
I'll be looking at earnings every week, so I'll highlight the key names like Darden.

I see ATW and RIG just blasting off. I've unloade...

2008-04-18T13:48:00.000-04:00

I see ATW and RIG just blasting off. I've unloaded all of them, but they continue higher. I'm thinking some of the infrastocks geared towards offshore drilling may ramp in response in combination with the other infra stocks. The whole drilling sector has been doing well, now that natgas is following. All cyclinders are moving. Technically speaking, I had a target on the breakout of oil, to 115-120. That's just based on the height of the consolidation below 100. So, its getting frothy to me. I also cut my ultrashorts to zero, but I've left the individual shorts. I'm even more enboldened to short restautants when the SPX pushes up against 1450. Have you heard any restaurants report?

I can just feel the weight in the Ag stocks. (Or is that just me "hoping" they fall) I'm still long, but merely because I dont want to go to zero position size. but if the kool-aid crowd gets moving, that is going to sap momentum money. And alot of it. not to mention, since the rest of the commodities related sectors are moving now, we should see some net money flow out of the Ags. agree with that article. I'm totally lagging the SPX today.. that always irks me!

PS - I hated reading about the IPI ipo. I want LESS supply of potash stocks;P

The oil service stocks are going paraboliceven HAL...

2008-04-18T13:33:00.000-04:00

The oil service stocks are going parabolic

even HAL the old mega cap one is like a chinese solar stock

I'll be fascinated to see what oil does IF the dollar reverses on all this "earnings strength", and continues today's move ... it is due for a bounce.

With oil finally sell off? Or not. If no... thats scary for US consumers.

My personal confusion aside, I did add to infra to...

2008-04-18T13:28:00.000-04:00

My personal confusion aside, I did add to infra today aswell. FWLT, JEC and OII. A bit of a mixed bag. I did a quick bit of 'eyeball' analysis and did note that in recent weeks, the infra stocks have moved with the kool-aid market. And these sectors i dont cringe at owning. They are also well off their highs, and while their chart patterns aren't the classic look that I enjoy (3 parallel 50, 150 and 250 moving averages trending up), the do seem to be in a bottoming process. Perhaps in a few months they will have that classic look again.