Bull Hunting

I have been eyeing the short side since the phase 1 trade deal was confirmed in mid December.  I didn't want to jump the gun because of the seasonally bullish late December period, so I decided that if the SPX was at all time highs on December 31, I would short.  It didn't happen, but the equity fund flows coming in at the first day of the year have boosted prices to levels where I feel comfortable shorting. 

I have started the short SPX campaign this morning, putting on about half my position.  I will wait either for tomorrow or early next week to put on the other half, preferably on a good ISM index number coming out.  The time frame on the short is 3-4 weeks, looking for lower prices as the Democratic primary in Iowa gets closer (February 3).  Market doesn't like uncertainty, and right now, its a neck and neck for the lead in Iowa, with Buttigieg, Sanders, Biden, and Warren all between 10-25% in the polls.  

As we get closer to February 3, stock prices should get lower as the focus is on potential bad outcomes with a Sanders or Warren win in Iowa.  

A longer term short (3 months +) will have to wait, as we'll probably see a reflexive rally after the first major pullback from the big surge from October to December, so this short is to play January weakness ahead of the Democratic primaries, with stock buyback flows very weak as corporations are in blackout period and traditionally don't buyback much stock during this month.