Seeing as how I am having a couple of dranks this beautiful Canada Day morning. However, that drink is coffee right now. Here’s how I see us playing out.
We’ve had a weak reversing the stream of selling in the market. Six consecutive down weeks have effectively been almost erased by a single week of action in the market. Beginning the week we led with large rallies in the commodity sector early in the week (Crude, Silver, Gold) and ending with massive reversals in softs (Corn, Wheat), bullish breakouts in Copper and Iron, with bullish construction and development data. There is no question it feels like the buy on the dip crowd while the S&P rested on its 200sma have been rewarded. I am once again feeling Long Term bullish, with a very short-term rest or pullback in the market.
I initiated a position in $X today and the trade length I am aiming for is early August. I hedged, and expect to be able to bank profit early next week with $TZA. Short Term we’re outside our Bollinger Bands on all indices and the $VIX is near its bottom support level. All these signal to me we need to have a small down day here and I intend to capitalize on this opportunity. See the charts of the $S&P, $VIX, and $IWM (Russell etf) below.
Hypothesis is, short term down, long term way up. Short profit will be immediately spent getting long.
I apologize this post is not well organized, going day drinking. Happy Canada day!
I also really like the iron/steel sector – lots of money rotation in. $ADV.vn Alderon on the Canadian Venture is my favorite Junior – life time hold.
Always remember we’re only seeing the beginning of inflation. Commodities are just pausing before we continue on to new records. This is still a bull market and there are still buyers.
Disclaimer: don’t buy my shit.