Haircut!

Market Trend Guide

I have been pretty on-point as per following the trend of the markets the past two months, and I think its time I start sharing my positions. My positions last anywhere from a few days to a few weeks. I rarely enter and exit on the same day, and I prefer to scale into my entries and scale out of my exits. That being said, I am not afraid to make a move when necessary.

I am still learning more about some technical trading tips, but most of my direction comes from an overarching fundamental knowledge - which directs the general trend of the market - and some fledgling technical analysis - which is directing my shorter-term moves.

In general I believe we are in the midst of a deep and enduring bear market. I see now such "V-shaped" recovery in sight. The problems that are being worked out go way deeper than any recession we have experienced in the last 70 years. The truth is we began this big bear in 2000, and the intermediate bull-era was a full fledged credit induced hysteria, that is only going to make our fall into the abyss longer and more protracted. If you are thinking about investing for your retirement, for your child's education, or any other long-term purpose, please wait. PLEASE WAIT! This market will take years to recover for any long-term purpose. Investing in equities now will be akin to leaving your money under a mattress for 5 years (a mattress will dollar-eating bed bugs). Invest in bonds, CD's, or pay down your debt, but please do not put long-term money into equities for at least 2 years.

That being said, in the interest of making some money now, it will take some more active investment. You will have to willing to cut your losses quickly and change your position. You will have to short the market some times, and be ready to long in others. Just know that we are in volatile times (a sure sign of a bear market) and buy-and-hold strategies are dead.

So for the last six weeks we have been running up with a nice bear market rally, there have only been two other times that the market has been up 6 weeks in a row, each followed by healthy pullback correction weeks. I still think that this little bull has a way to run, but we are going to have to catch our breath a little from the last few weeks. Prepare yourself for the pullback this week, and then another last gasp of the dying bulls.

The nature of our economy

One of my favorite websites recently has been EvilSpeculator.com, the guy that runs the site does some very intense technical analysis on movements and trends in the market and freely posts his charts on the internet. He has also cultivated quite a community of fellow traders and analysts that rode shorts all the way down to 660, and went long right around 700 (on the S&P that is), for quite a profitable year. Every once in a while the admin will post a picture that just captures the irony of it all, and here is what he posted today (the frontpage of marketwatch.com).

Wedding Crashed and Heading to NC

The wedding was a smashing success, plenty of good food, booze and merry time all around. The ceremony was on the front steps of a museum, as some ominous weather threatened to turn the wedding into the 50m freestyle, but a little wind was all that Madre Nature would conjure up. Some after party in the hotel and a late-night steak and shake rounded out the day nicely.

Many thanks go out to Matt and Melissa for getting me to the airport on time the next morning. Waking up at 8 AM and driving two hours to the airport after an all night party-fest is no small feat.

So today we decided to head to NC this weekend and found some crucial tickets to Wilmington, it will be nice to be in NC for the Final Four - as opposed to last year sitting alone at The Bulldog in New Orleans without a UNC fan in sight. I did get a pretty bitchin t-shirt though.