It's getting to the point where I'm just going to let Royal do all my posts; he's giving me all this great material. Here's what the past five months have felt like:
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This whole "buy the dips" nonsense is in its fifth month of working well for the bulls. Painful, ain't it? It seems that on the rare instances the bears get a respite – – like just a few days ago, on Monday – – it's a "one-hit wonder".
The real risk, I think, is if the market can click above the highs seen earlier this month. We are not far away from them at all, and some of the major patterns that have formed are pretty bullish. Let's take SSO, the ultralong ETF, as an example:
If we break above 31.94, the recent high, that's going to be quite bullish for the market in general. And let's take a look at the even more potent FAS, whose recent high is also marked:
One doesn't have to squint real hard to see that these are good, solid bullish patterns. I have held my nose and start acquiring "lottery longs" again, to try to ameliorate the mountain of shorts that I have.
So, for me, Monday was awesome, and Tuesday, Wednesday, and Thursday have been rather un-awesome. I know we're in OPEX week, but I don't think the trading world is turned on its head every few weeks. In other words, "that's no excuse."
The funny thing (well, not ha-ha funny, but ouch-funny) is that I used to hold up mid-March to mid-May 2008 as the oh-so-awful, gosh-I-hope-I-never-endure-such-a-thing-again time period. But these five five months make that prior timespan look like remedial kindergarten. The past five months easily "out-brutal" last Spring, so shame on me for even mentioning it, since the trading gods thought they'd have some fun.
Anyway, I think I'm done for the day. I'm a lot less chatty, as you've noticed, on up days versus down days. It's the nature of Slope. Good night!
One of these days it's going to get through my thick skull that 2009 is the Year of the Lottery Play. It's just about the only thing that's consistently been good for me this year!
Just yesterday, I bought seven lottery plays. Want to guess how many of them are profitable since yesterday? Yep, all seven. And one of them, shown below, is up over 10%. Sheesh!
The galling thing is that this thing hasn't even broken out yet. If it does, it could move way, way higher. And it's not like the market in general has exploded high in the past day. But these lottery plays seem to be the place where all the juice is.
Going through charts, I'm inclined to agree with the Prechter notion that all assets all the same these days; in other words, they all fall together, and they all rise together. Whether I'm looking at FOREX, energies, financials, general equity indexes, precious metals – – they are all very tightly correlated (or inversely correlated).
Things seems more and more stretched into the "something is going to snap" mode, but as my Lucy-snatching-the-football away suggested, the amount things are getting stretched just seems to go on forever. One clean trendline break I've seen is GLD.
Random remark – to those of you who subscribe to the Kirk Report, there's a long interview of me coming out with him tomorrow. He's going to let me republish it here in several weeks, but for those who already read Kirk, there's your heads-up for ya.