Today was not fun, a market rally with a broad pullback in the PM’s left me and my hedge feeling useless and hurt the balance of the portfolio. Nevertheless I strive to be above these meaningless day to day fluctuations, the precious metals are, and have always been, fickle, volatile, and manipulated. I refuse to be shaken out of my position and so I must bear the losses. I draw some solace from the thought of those shorting the precious metals getting run over in the near future. Should gold or silver go lower I will buy it hand over fist. If you have not concluded it yet, I will spell it out: I am allocating my assets based on the expectation of the next tinpot dictatorship – I mean middle eastern country – to be toppled. I expect this to result in a market selloff with gold, silver and oil shooting directly to the moon. If you believe this is an ‘if’ and not a ‘when’ I suggest you try not eating for a week and see how amicable, calm, and not at all desperate you feel.
With regards to the market, today was an interesting day. We saw the market trade up without real leadership from the leaders – excluding IYT (the trannies). Copper is flashing warning signs, and momentum chasers are being torpedoed in stocks like FNSR after hours. Speaking of which, I expect us to open lower simply due to the massive damage suffered by tech momentum stocks in the after hours. A quick list of collateral damage in the FNSR fiasco: JDSU CIEN APKT ARUN AVGO. In any case, when stocks are falling 35% because of earnings misses you participate in the bubble… I mean market… at your own peril. Clearly no one saw this coming, because after all the falling demand talked about by companies like INTC and CSCO was clearly just because these companies aren’t viable anymore. Following that theme, if you think this kind of action will be contained to those names, or even that sector by all means buy the open with great vigor.
I may post some charts later on with some setups I will watch tomorrow. On a work related theme, today the action in V left me stunned, but I managed to get a piece on the way up and down.