Friday, July 17, 2009

Visting Day

Like many of my peers around the metro New York area, I am heading to the Pocono Mountains in Pennsylvania this weekend to visit one of my kids at camp. If I had all the money I spent on the luxury they call "camping" I'd bail out CIT myself. But that is another issue.

It has been a rough week for me and the bears (bad grammar intended) as the stock market soared. No, I was not caught off guard for the rally and I wrote it up in Monday's newsletter. But the distance it traveled killed me. Visiting Day will be a vacation away from thinking about it so I can return next week with a clear head.

Here's what I see:

dollar is weak
commodities have corrected
stocks flipped not only me but every analyst on Wall Street the bird.

Have you ever seen so much flip-flopping? Everyone was bullish. Everyone was bearish. Now everyone is bullish. I cannot wait to see the sentiment numbers for this week.

4 comments:

Mike said...

Do you have a thought on the VIX? If you look at the ETF for the near-term VIX futures (VXX), it looks like the possibility of a double bottom. I guess you could say the action over the last few days is a bear flag, and it's going lower, but the volume has been heavy, so maybe the VIX is bottoming here???

rb531 said...

Mike,

I find some solace in your words that it caught a lot of people off gaurd on wall street.

So who made money? the mutual funds?

rb

William said...

The market will do the most obvious in the most un-obvious manner; most sectors look like they've rolled over except health care, staples, and tech (...the best offense is a good defense?). Couple that with volume taking a dive... I think at minimum we can say the market doesn't look healthy right now.

The distance was killer to me too... but on a psychological level it looked like the desperate last gasp (low volume) of people who missed out on a huge rally looking to get long.

I'm staying the course until the market tells me I'm wrong with some new highs or some buying with actual volume.

rb531 said...

william,

that makes us 3 in the camp. but the way market is acting, things will just fall into place over time. in other words, market expects the good news on earnings will keep rolling and by the time its over you will see a slight pause (not a pullback) and then when economy news will start to look good. this is what happens in a bull market. i started some bullish put spreads. not sure, if i jumped the gun late. but atleast i cant suffer more. market made a 50% rally, i made 0 profits shorting it. i would've lost all of it if it wasnt for some money management. atleast for me its safe to say, technicals didnt help. they have been wrong consistently in the up move.