“There is a time to go long. There is a time to go short. And there is a time to go fishing.” -Jesse Livermore
I feel like fishing now. It’s a battle, and when it becomes a battle, small positions and gobs of cash are the only way to go.
I’m flipping back and forth from the Rangers, (I hate hockey), and the Mets, (I love pain), golf will be thrown into the mix at 3PM down in New Orleans as I watch alligators take snaps out of guys in the sand. I’m also looking at some charts. The charts look like Dresden before the bombings intensified.
The market is back to hating everything again. The final nail looks to be getting driven through the foreheads of the momentum/cloud/IPO names.
Putin continues to behave badly, but we have arrows in our quiver. Whatever the f@!% that means.
Housing put out the worst number in 14 years the other day. You can blame weather, global warming OR Justin Beiber. The problem is that wages haven’t risen, while property values were pushed higher by those all cash hedge fund buyers. Thank goodness for them or where would the numbers really be? You can be bullish stocks despite this pathetic jobless uncovery. It’s paid the bills so far.
However, if you believe in all that “seasonal stuff”, you may want to be out of stocks here. Sell in May and go away is ALL you will hear next week on America’s smartest finance channels.
Also, let’s not forget that dreaded “Presidential cycle” thingy. My pal Ryan Detrick over at Schaeffers Research, in my opinion the master of statistics, points out that going back 40 years, April 21 is when the market has historically peaked until a bottom gets carved out in October during this cycle.
On Friday we saw $YELP down another 8%, $WDAY down another 7%, $SPLK down another 6%, $AMZN down 10% and $NFLX down 6%. Brutal action.
$AAPL will go higher here because they wont short a monumental buyback and shorts have to pay the dividend. It’s the place to hide now.
The banks look ready to crack lower. $FAZ may be the play short term as the charts of $GS $JPM $C and $BAC look lower. I have some $FAS that I need to exit, probably at a slight loss if things don’t shape up.
Energy $XLE has been acting great, but looks extended and $OIH is right at the top of a channel. So even that group could come under short term pressure.
Biotech $IBB had a nice little bounce back, but it is giving up the goose again as it approaches its 200 day moving average again. If that breaks, it goes lower and will at the very least retest the lows it put in on April 15.
You have to do a double take when utilities and consumer staple stocks are making highs. Bonds also continue to have a very firm bid. It may indeed be time for those band aid and booze stocks, as they continue to wash out the high beta stuff.
Good luck next week.
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