Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Pushmi-Pullyu

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Well, the market presents a mixed bag – – some major indexes look bullish (which explains why I finally relented by actually BUYING some stocks, which is probably a huge short signal in itself) and others look bearish. Let's take a look at them, in bullish/bearish order:

The NASDAQ Composite pushed above its long-term resistance line late last week, and it's been inching higher ever since. This chart is bullish, period.

0207-bullishCOMPQ

The Dow Jones Industrial Average (the Dow 30) likewise beat its "bin Laden high" from last May 2nd.

0207-bullishINDU

The Apple-powered NASDAQ 100 has been on a huge tear since Thanksgiving, and, as with the broader Composite, is straight-up bullish.

0207-bullishNDX

The strongest argument for the bearish case (which could be badly damaged by a single "good" headline at any moment) is the EUR/USD.

0207-bearishEURO

It turn, the $HUI Gold Bugs Index is poised for a beautiful fall (provided it stays under that centerline).

0207-bearishHUI

The Russell 2000 is right up against resistance, and this is a point where it could easily slip back to the high 700s.

0207-bearishRUSSELL

The Broker/Dealer Index, $XBD, may have double-topped.

0207-bearishXBD

Lastly, the NYSE Summation is a screaming sell right now. Look how it's configured compared to Spring 2010, shown on the left, just before its big tumble.

0207-bearishSUMMATION

So your guess is as good as mine at this point. At this moment, I'm 50% in cash, and of the 50% in equity positions, 25% is long and 75% is short. It's pretty much all about the Euro at this point, folks. We are all FOREX traders.

Back to the Hybrid Model

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Well, this morning was the final straw for me. Everything was looking ship-shape for a nice tumble today, and then ol' Ben came out and said whatever he needed to say to crash the dollar and goose equities again. The GDX, shown below on a minute bar chart, nicely expresses how a very clean breakdown was turned around 180 degrees.

0207-gdx

I have gone long sixteen carefully-chosen equities. I am still keeping a big chunk of my portfolio in cash (a little over 50% right now), and I've got a 30/70 split between long/short. So, effectively, I'm only 20% short the market.

In any case, I cannot depend on the market going down in order to turn any sort of profit, so I've got a hybrid portfolio again. The cleanness of the NASDAQ breakout is simply too evident in order to not have a single long position.

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