Thursday, July 16, 2009

Short Update

There is really not much more to say with this crazyness. From best quarter in a decade to best day in the quarter. While I am glad I managed my short exposure correctly yesterday by closing out in the morning hours I am still baffled at this week overall. I have never seen such overbought indicators on the 60 min. The only thing that compares is the october 2008 crash in terms of oversold indicators - and we all know what happened - a rebound or retracement never came. We have sold off a bit in the overnight sessions but most of it recovered due to the amazing JPM earnings - forget about everything else - if a bank can manage to make money, all things are good, everything else is irrelevant.

For today - I am not sure what will happen. I got into some shorts at the close yesterday but those had a clear plan - a gap down overnight was the only way for me to hold on to those and it seems we are not getting a chance to have this scenario play out. I will be going back into cash most likly within the first 15 minutes of cash hours - I will keep it updated in the comments.

Lets see how far this crazyness will continue. This week has definitly been a blow to any bear out there - and many are still left to cover. More covering in this range here with the fear of higher ranges is definitly in the cards today. Now the bear in me talking again sees a few things. How do bear market rallies end? (haha I know don't bash me for not being on the long train - I tried and failed so eat it).

1) bear market rallies end on good news - CNBC stated the recession is over (hah) = check
2) bearish blogs turning bullish = check
3) many blogs talk about higher numbers but no one has a clear plan nor a clear target - everyone keeps on stating we will go higher, make new highs but no one knows for sure, the only thing we keep hearing is that we will go higher = check
4) even the most committed bears capitulate - I did, quite a few others did, many are still to follow = check
EDIT: 5) complete dis allocation of asset classes, price, volume and time = well check on this one too

Of course I am being a bit silly here as I said the same thing 2 months ago - but I am going to say it again. Keep in mind - we are still at the same exact ranges we were at in the beginning of May. That is 3 months of indecision now - I said after month 1 it cannot go on, I said the same after month 2, now in month 3 I am saying it again. What will month 4 bring? you tell me ...

1 comment:

  1. 150% cash now - closed everything at break even.