It's been difficult for me to write about the market. My timing model (the Black Box) is best at timing the Nasdaq 100 and Semiconductors. Since last Fall, the QQQQ really haven't done anything but go sideways. There have been chances to make gains trading the channel, but the Black Box doesn't quite work like that. So instead of just repeating myself that the market is due for a correction and that I remain careful, I'm going to discuss a long-term and short-term view. Just for something different.
- Long term: (Here comes the repeat). I remain with cash and a QID hedge, while my long positions are mostly in the total stock market ETF, the VTI. I believe that we will see another trip down to the lows seen in early March. I think that the market will probably hit some complacency in the week(s) ahead, and that'll lead to a selloff. I think that'll it will happen very quickly and wipe out the gains since the March lows, trapping bulls here at the highs.
- Short term: One has to be pleased as we head into options expiration week that every dip gets bought, and that reactions to news and earnings seems to keep the upward momentum going. We're all bored with Iran, Iraq, North Korea, inflation, housing, sub-primes, etc. Nothing matters right now except that folks want to buy and chase stocks. I am continuing to play the short-term mo-mo stocks. Some of these are getting quite extended, but that's where the action is as folks seem willing to assume more risk to chase what is moving most. And that's what I'm doing, too. But of course, limiting it to a small amount and ready to pull the plug as soon as things look shakey.
- CNBC Contest: After selling "everything" yesterday, I remained in cash today. I will look to reload next week into a maker or breaker. Being in cash cost me today, as I slipped in the rankings. Rank 180761 (Top 22%).