Tuesday, March 4, 2014

Putin Redo

Putin says nyet to attacking Ukraine.  I underestimated the man's poker skills.  He folded his hand on the flop, didn't even wait for the turn or river.  He doesn't have many chips to play with, and he knows it.  He saw his stock market get crushed and knew he had to act fast.  Yesterday was a golden opportunity because of the uncertainty and fear that I saw out there.  Not the fear of the market tumbling, but the political fear, a more irrational fear which has no lasting effect on the market.

Unfortunately, other than a quick scalp of a move in the opening half hour, I waited for a bigger down move that will not come.  It figures.  Since early February, this market has not given longs a chance to get long on any deep pullbacks, it has been one and done.  One down day and back up again.  Often times, not even one down day, but one down night, as the overnight session dips, only to see it being lifted in the US premarket and then into the stratosphere during US regular trading hours.  

A market that doesn't let in dip buyers unless you have the threat of World War III is a strong market.  The sky is the limit.  I wouldn't go short until you saw euphoria.  And the only way I see euphoria is if we go up for another 2 or 3 weeks.  By that point, we're probably 1900+.  

With this monster gap up, odds are that we keep going higher.  The market was on that course before the brief Putin disruption.  I am on the sidelines, seeing one more opportunity pass by.


Anonymous said...

Hi MO, I have some questions about short natural gas trade.

1. Price gapped down once the morning session opened in the last few days. Does it mean bearish?

2. Few days ago, you replied to my previous comment, "The move last week tells me the power companies have already hedged and the only buying power will be coming from commercial shorts or speculators adding longs". What move do you mean?


Market Owl said...

1. I don't determine bearish or bullish by one day's trading, or by a gap up or gap down. I look more at the trading over the past month.

2. The move down from 5.20 to 4.45 last week.

Anonymous said...

Putin probably went long futures before his announcement.