Good morning, everyone. I’m composing this fifteen minutes into the trading day, and thus far my lovingly chosen short positions are having a good session. This is in spite of the fact that the past four weeks have been a merciless grind higher (and I suppose this would be an opportune time to apologize for being such a pill lately, but I’m a sensitive soul and given to bouts of intemperate moodiness, as long-time readers have surely divined by now).
If, God forbid, we close higher today, that’ll make a 90%-win rate for bulls over the past twenty trading days.
I would hasten to mention that during past bear markets (remember those?) counter-trend rallies are powerful, violent, and bear-crushing. It is one of the great ironies of trading life that perhaps the cruelest and most destructive of environments for bears is…………..a bear market.
We are surrounded by opportunity, however. The materials fund, XLB, remains an absolutely exquisite diamond pattern setup.
And, as I keep harping upon, the small caps IWM is an extraordinary setup as well, although it seems prone to fussiness (as am I, see above). It would be nice for this thing to just let ‘er rip, but as I wait, I’ll draw upon the very thin well of patience that resides within me.
As we draw closer to the end of the trading week, I’d say the best news, by far, is America’s tacit surrender in the trade wars. The overhang from this Sword of Damocles made being in any position nerve-wracking, and the cessation of the Liberation Day nonsense has, to a very large extent, cleared the air for more rational thinking.
Good luck, and I’ll be in touch again soon.
