Friday.... all indices gave a clear signal that this market does NOT want to consolidate even for one day in the current stage of UPTREND....
CMF was @ strongest level on Friday also...means smart money pouring in...
What about Dumb money..ala followers of bears & their spokesperson Art Cashin...they are being hit very hard where it hurts....in their equity...which by my account...they must be in deep hole since March or Since early July correction......
July pullback barely lasted 3 weeks based on questions about strength of recovery.......
Answers..... about the strength of recovery is coming fast & furious from China,Canada,Germany,Great Britain and even in our in the dumps housing market.....
So.... markets are Saluting the positive avalanche of economic data worldwide by kicking the old resistance into a "piece of cake & you can eat it too"
So..Bears have NOTHING to put their hat on anymore...WEAK economy was their last "big money making machine"
Bears were also leaning on "bad earnings reports" to PUSH their thesis to SHORT & create PANIC among bulls.......
Guess what...
Bulls... KNEW that except GS mastery in trading & being ahead of the curve that financials ER will be BAD as expected by them.......
Bulls.... also KNEW that most Tech will kill estimates for both TOP & BOTTOM line & guidance will be better than expected/past trends..so they kept buying on any weakness..
Shorts took "too long" to see or ANTICIPATE a changing trend in economy or earnings picture.......
NOW...that the whole world KNOWS about better economy & better earnings going forward...bears & their spokesperson are "throwing their white towel" on Friday......
This surrender to markets TAPE @ ABOVE breakout levels...will create a stampede of "short covering & reallocation of several TRILLIONS in a popular asset class known as stocks......
This reallocation in the bull case for stocks will takes US very "quickly" into a 10%+ gain in all indices.......from Friday's close.....
So..... S&P 500 which closed @ 979.26 will easily JUMP to 1080 in a hurry ..a further gain of 101 S&P 500 points or 10.3%.....similar or better gain for Nasdaq & Dow are also expected......
Most sectors will participate in this ongoing rally..some MORE than others...so it will be PRUDENT to DIVERSIFY in many sectors......
Also make sure your $ allocation in equities is in-line with your comfort level......
Here is my allocations & sectors as of Friday's close:
GNK 11.65% Shipping
IPI 10.30% Ag Potash
SOL 23.55% Solar
RIMM 32.30% Tech Smartphone
TLM 22.20% Oil producer
My rationale for above pick/allocation % is that I think most of the above stocks are "undervalued relative to their peers"
As I am bullish about the current trend of the TAPE going forward..I am @ the same $ investment as I had back in June of 08 when S&P 500 was above 1400....after S&P 500 touched 1576.09 way back in October of 07......little nostalgia CAN give you the "big picture"
I will continue to buy more stocks based on my "relative valuation metrics"..means buy those stocks/sectors which are lagging still.....RSI is my gospel for buying/selling position.....switching to better value is my mantra......
So...based on TAPE...we are heading "north"......
BDI should pick UP in a hurry also...
US$ should continue to go LOWER...
Gold,Siver,base metals are on the verge of major UPtrend...copper is the-leader.....
Techs will be the darling of investors/traders...Q4 is going to exceed all expectations...Christmas will be a major catalyst......
Always buy..what you know & understand well...do NOT buy the HOT stock of the day as relative values are always HIDDEN from headlines...once they make headlines majority of the gains are already in the bag.......
Good luck in your OWN strategy.
BLOG does NOT give buy or sell.
Saleem
9 comments:
Hi Saleem,
From your guidance, I will continue to sell OTM calls as my stocks rise to capture extra gains. Will continue to hold positions and consider sales at the next pull back. Good luck this week.
Best Regards
Hi Standards,
That is a good strategy to lock extra returns.
We are certainly looking @ positive/improving economic picture going forward....
As goes the economy ..so goes the stock market..an old reliable formulae...
Good luck to you this week.
Saleem
Hello Saleem,
WOW you are quite an optimist--love it!
My GE $13 calls seems prudent-now.
I may try some for my IRA, covered calls @$13 they may get a lot richer going forward --I got 1300 GE in my ira ready to --party.
My DSX is stuck around $14 looking for a break out. DSX is way over sold and has a ton of cash on hand to buy more ships--they still have 1/2 of there ships under the real high old shipping rates--yahoo!
So a 10% rise in the stock market may get my LT holds out of the red--we will see!
Talk shows are NOT putting much faith in this run up
Giddy up market
The best to you all!!!!!!!
Standards Gas in DC is $2.45. And I see low unemployment here--seems the Government is hiring...
Hi Madmax,
It is NOT prudent to be "bearish" when markets have moved UP 47% since March lows and holding the gains...
TAPE is very strong for many stocks..sign of "good things to come" & GE MAY bring some LIGHT to your portfolio.....
Saleem
Hi Madmax,
Government hiring to take up the slack. I'm applying myself. My business has stopped. My friends businesses have near collapsed. Stimulus money sent to the Atlanta Arts Counsel??!?!?!?!? WTF!?! Citizen revolt over huge property tax increases. Local government projects being shutdown. More layoffs. Ammunitions hard to find at retail.
Just the usual stuff. Looking forward to more gains in the S&P.
Best Regards
Hello to all
Standards
I am so sorry to hear that your business is not stabilized. Can you hold out, or is it to far under water to save. What kind of job are available to you in Gerogia?
I do hope that you do well and keep me posted on what you decide to do
Regards to you
Hi Standards,
Life brings MANY challenges to all of us @ many stages.....
I am sure you are working diligently on Plan B.....
As you very well know that we are all here wishing you the best of solution to your current shift in life....
If nothing else Sharing with us brings a rapport which is important in challenging times.
Good luck in your efforts to "re-align your focus"
Saleem
Saleem
news on Shipping
The Baltic Dry Index (BDI) is up 4.5% to start the week, sending dry bulk shipping stocks ahead.
Related Quotes
Symbol Price Change
DRYS 6.87 +0.64
DSX 14.78 +0.18
EXM 9.22 +0.30
KEX 33.86 +0.47
OCNF 1.45 +0.10
ONAV 3.79 +0.03
SB 8.12 +0.17
SBLK 3.60 +0.09
{"s" : "drys,dsx,exm,kex,ocnf,onav,sb,sblk","k" : "c10,l10,p20,t10","o" : "","j" : ""} For dry bulk shippers, profits depend on development and economic expansion, which spur the need for overseas shipment of goods. According to Michael McDonough at TheStreet.com, this week's key economic drivers are new-home sales data and durable-goods orders. While investors will have to wait until Wednesday for the latter, new-home sales numbers came out today, and they were up big. In the U.S., home sales were up 11% in June, the biggest jump in more than eight years. Ahead of the report, the BDI - the most popular measure of dry bulk shipping cost - was up 4.5%. Today dry bulk stocks are up as much as 7% as investors bet on continued economic recovery.
As a whole, the Dry Bulk Shipping Stocks Index is ahead by 1.6%. It is now ahead of the S&P 500 by 2% over the last month.
Hi Madmax,
Thanks for BDI info..as I do not track it...so it is nice of you & standards to post for me & others who are in this sector.
Saleem
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