ES -- DX/CL -- isee -- cboe put/call -- specialist/public short ratio -- trinq -- trin -- aaii bull ratio -- abx -- cmbx -- cdx -- vxo p&f -- SPX volatility curve -- VIX:VXO skew -- commodity screen -- cot -- conference board

Friday, January 04, 2008

 

oops


"mixed picture" didn't keep me from expanding my longs a little today near the close, adding more QLD.


that wasn't very bright.

what i said yesterday afternoon is still true -- trin and trinq are (at this very moment) very high, sentiment is quite bearish, and things are now pretty oversold.

of course, all of that is merely getting moreso today, and my yesterday's purchases of QLD are taking a 7% shellacking, thankyouverymuch.

worse, i can't help but think that, had i been in office on or about december 26, i would've taken the refusal of 20- and 65-day new highs and lows to move favorably as an excuse to cut or even reverse the position.

the next (and very valid) point is, "if you would've sold then, why didn't you sell on january 2? why don't you sell now? why instead did you buy in further?"

the answer is, effectively, a certain reckless anticipation of this being an effective base construction. in the economic picture, i can't be more gloomy -- i do expect recession or worse, and lower asset prices before 2008 is out. i don't expect ndx 1990 to hold all year.

however, even if that's the destination, the path by which we go lower could be surprising. perhaps a set of constructive shorter-term divergences and sentiment readings are about to get slaughtered and force me to change mindset, but that hadn't happened as of last night's data. so i'm set to wait -- or even consider this moment to be, looking out six weeks or so, the best buy yet.

if it is, consider XLP.

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