Friday, January 20, 2012
Up and Away
It is a bull market in US equities. You have to follow the bull market trading plan if you want to trade with the highest probability. Shorting is ruled out unless you reach extremes in optimism, which we have not yet done. There is going to be a dip of 3-5% when some "spooky" headline comes out of Europe and you have to buy it. Not much to do while you wait. Bull markets are waiting games. Trade less, hold longer.
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10 comments:
Dawg what about a long trade on natural gas contracts.
10 year low seems to be at 2 bucks and it's currently 2.37.
http://upload.wikimedia.org/wikipedia/commons/d/dd/Henry_hub_NG_prices.svg
CIE - one last pop to 22 and then put on the short trolling lures.
FTK - most likely on a path to 20 in a few months.
You forget the fundamentals ... there is just no way the US can make more then 1300 for a sustained period (3..5 years).
Now is the time to look for a drop.
I think any drop down to 1260 will be aggressively bought. US equities are in high demand, as crazy as it sounds. The fundies are shunning Europe and nervous about emerging markets, so the only place to go is the US, even if the valuations are the most expensive. Expecting 1370 by May, like last year.
Natural gas, the most bearish market in the world, with the worst supply demand fundamentals. It goes down every single day, and is in a deeply entrenched 3 1/2 year long bear market. I'll pass on the long side.
1370 ... and a big dump again ?! And EOY -> 1500 ? ... :-)
That's why they call me the OL DAWG.
I go where no DAWG has gone b4.
OL DAWG
Long REXX @ 10.10
Long SCOK @ 2.50
Long TVIX @ 19.06
Long PERF @ 10.10
feels like fall of 2010, after the fed started qe2.
The market kept going up and up and up. Any overbought indicators were worked off by the market going sideways for a day or 2. then a continue higher.
I'm not saying this is the case it just FEELS like that.
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