Chilly Musings

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The winter cold has set in hard around the San Francisco Bay Area (even though we’re technically still in autumn), and, now that all the day’s tasks are done, I finally have some time for a proper post.

Looking at the big equity indexes, things kind of stalled from the vicious upsurge at the point I’ve marked in green. We’re in a (very!) modest down-channel right now, and the real moment-of-truth comes if and when the price can penetrate the level I’ve marked in magenta.

1209-lateCOMP  1209-lateINDU

One strong ally for the bulls is semiconductors. It’s quite obvious the 2007-2008/2012-2013 $SOX analog didn’t work out, and there’s nothing about this chart that is anything but bullish (and if you look at Micron, symbol MU, you can see a big part of the reason behind this strength).

1209-lateSOX

For those so inclined to a short-term bullish play, the miners don’t look bad. The prospects aren’t good enough for me to bother buying into this, but I’ve outlined a prospective scenario below. Gold has been picking up a little steam lately, and I’m not touch that either. I’d be happy to short it again at a somewhat higher price.

1209-lateHUI

Instead of yellow gold, I’m focused on black gold, and I entered a modest (1000 share) short position in USO today. Staying beneath the horizontal line I’ve illustrated on the front month below is key.

1209-lateCL

Obviously the Big Event is going to be the Fed announcement next Wednesday, and that’s honestly the only meaningful event left for all of 2013. I think we’re all completely sick to death of the “taper or no taper” question. It’s just nauseating, and a little sad, that the markets have been reduced to this as their main focal point. But, like it or not (and I don’t), that’s the market we’ve got.

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