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).


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.


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.


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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