Other than Goldman Sachs (which I ahave no position), we are in meltdown mode. Actually, Starbucks is up :) .
It sucks.
I have some piss in the wind SPY puts but maybe 10 percent coverage. I am just giving back some meaty gains that had been accumulating. Stops that I did not feel would be in play until the New Year, are whiskers away.
Most of the givebacks though are of the October massive gains so I am still unsure if a real meltdown is at hand.
On the bullish side, Dr. Meltdown (Bill Fleckenstein) who has called for this for 10 years, is looking like a genius. Today, he is calling for the same crash he always does . Even a broken clock…It is actually his crash call that gives me hope. Thanks Tim for the e-mail, but why are you reading MSN Money.
Anyways, this is not a time for me to act all brave. My stops will keep this as a great year and I will obey them.
Let me know what you think.
Hi Howard … Times like these get me thinking about technique. I’m curious whether your stops are automatic, or whether you look at the company when it hits your stop level and make a decision at that point?
for me – 70 percent autmoatic. wish I was 100 percent .
Usually, when the VIX reaches over 30, which it did today, it’s a sign the reversal is coming.
I sure hope it does as I am now long, APPL, EMC,NUAN and FLIR.
David,
usually when i eat beans I get diahrrea.
You can count on it, but that does not mean its not messy :)
Fleckenstein, David Tice, all these perma-bears are coming out of the woodwork. Tice’s fund has returned -1.28% annually since inception (back in 1995 when Seinfeld was still printing new episodes).
“David Tice Says U.S. Stocks May Fall 50 or 60%”
http://lcmarket.blogspot.com/2007/11/david-tice-says-us-stocks-may-fall-50.html
Technically, we warned about the market trend a while back and called the market neutral with downside risk within the trading range of SPX 1450-1550. We are at the lower range and the tape is still looking sloppy. The correction an magnitude of price drops is getting more severe as we enter the rough part of the correction (do we hold critical support at SPX 1450). One indicator that is worrisome is the McClellan Summation Index, an indicator i have use my entire career. My personal interpretation is that a drop below the 0 line represents an acceleration of a decline where price depreciation accelerates. On a positive note, it also represents, in my opinion, the final descent before a lower-risk entry comes into play (as we saw in August 2007 and previous bottoms over the past 3 years). The McClellan Summation index, for me, has become a very reliable technical indicator from an intermediate-term basis. It does require patience and will usually give a good buy signal when the market looks like death. Death seems to be closer every day.
Would you believe I wasn’t reading MSN Money, just looking at the pictures?