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Rally today a bit better. Here is what I would like to see now.
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Hi fellow SLO players, We were able to see a little "follow-through" today as I had hoped we would see. That is a good sign for the "longs" and not such a good sign for the short sellers in this market. However, as I said when this happened the last time, if you are nervous and lack conviction that this bounce will sustain, then it is a great time to sell out at a higher price than the fear ridden Monday would have been. If you are a strongly convinced bear, than I guess this is a time to short more stocks. For me, I feel that the best approach is to pick good stocks and stay the course. I have made my "bet" and I will stick with it until I find data to support a reason to change. I will continue to add positions to use all available cash and then sell parts of these positions going forward if the rally progresses and I think we might be getting a little ahead of ourselves. Also, a fellow SLO player commented on one of my posts that this is a "bimodal" market and, therefore, as stockpickers market. I agree. I think that any year end rally will not "lift all boats" so we need to pick our stocks wisely. I picked up more JCP yesterday simply because it was so technically oversold and is a quality company. My position in that is far too large and it is likely to still be a weaker performer in the short term even if a real year end rally is beginning. However, I do not want to sell my entire positon because I believe in the stock long term. Therefore, since it bounced today faster than the overall market because retail in general and JCP in particular was severely oversold, I will use this as an opportunity to sell 1/2 of my position to use with another stock showing better short term potential. I might be selling too early, but I want to use the capital elsewhere. I plan to add the ARO position soon since I missed my opportunity today. I also want to add DE as an agricultural and "weak dollar" play. I know that it has been a great performer lately, but I think it is still relatively cheap from a valuation perspective. I think stocks such as DE (John Deer) will outperform in any rally because they have remained technically strong even in this recent correction. Finally, as far as the overall market is concerned, I am hoping for some relative tranquility for the last two days of this week. Personally, I would like to see the market go down a bit and up a bit in the final two days. If volitility drops somewhat, it might be a better base for a continuing year end rally. I think that there is a fairly good chance this will happen and it would be a good sign in my view for us longs. C Ya, DocA | ||
Comments (4)
Doc,
we feel better with the sun shinning bright above. We have only had a few of those as of late. Now my SLO teammates are feeling a true Chi town winter --- I can do the weather for a %^&* alot less dough.
Watch out for those cloudy ,cold overcast dazs. I am a bull at heart but many of a fellow SLO sidekick are going to try to do wild and crazy things in the next few dazs. I bet SLO $$$$$ that they would not do this with real weak $$$$$$ of their own !!!!!!!
I for one need the cash to buy some good holiday brew. I toast one for you . Cheers, DuffBeer
Posted by duffbeer | November 29, 2007 10:04 AM
I couldn't agree more with you regarding the best approach is to pick good stocks and stay the course. Well said.
Posted by Raju Dantuluri | November 29, 2007 10:46 AM
"am a bull at heart but many of a fellow SLO sidekick are going to try to do wild and crazy things in the next few dazs. I bet SLO $$$$$ that they would not do this with real weak $$$$$$ of their own !!!!!!!"
duff- I could not agree with you more :) I think that I could have probably done a whole lot better in the last few weeks and probably could almost guarantee to keep my lead if I split my portfolio in 5-6 positions say like POT, BIDU, GOOG, APPL, FCX, RIMM because if they go up you can't quite catch me and if they go down - so will most of my closest competitors :)
But that would amount to nothing more than a "double or nothing bet" sorta like the one Andrew Carlson did a month or so ago. Unfortunately concentrating positions to such extreme goes against my long term strategy so I will stick with my rules at this point :))
P.S. Great post Doc.
Posted by dishwasher | November 29, 2007 1:30 PM
Doc O' Zirconium
As the Un-official "Wild & Crazy Guy " of the SLO Mo'GO ( sama sama for Poet Lore-eate & FILL-ossified-er ), I fell compelled to Chimerally Chime in here with my 2-cents Wurf.
MAX StarZ , yada, yada, yada !
Markets Crawl up a Wall O'Worry.
People with OPM ( Other People's Money ) NEED to Succeed ( relatively speaking ).
There's a LOT of Moolah on the side-lines with No Where to go but sub-inflationary interest rates in MM funds that just might 'break the Buck' due to holdings in derivatives of domino-effct failing Tranches.
The Market's the Only GAME left in Town ( Ok, buy Real Estate on Spec' if you wanna - but Who's gonna wanna NOW ? )
I've beeen 'preaching' the 'Glaw-ries' of Big Cap mature dividend Payers ( above Bank account offered rates, even ) & fiesty small companies with 'heads full of ideas that are driving ME insane) - The Wave of the FUTURE Stuff.
An initial 'Flight to Quality ' then Die Neue Wellen ( the NEW WAVE-ers ) as cofidence returns.
The GOOD willl out - as it ever & always has.
I raise a Duffer Beer to to the SLO Chief Cook & Bottle Washer - he's developing into the True leader I always thought he might become.
As George Thorogood once said, " it's In him -and it's gotta come OUT".
AS for Duff - the Romans were superstitious of Cliudy Days - they would close their Markets and stay in-doors to avoid thunder & Lightning.
This FEAR is the basis for ( what else, but ):
The Song O'da DAY
UnCloudy Day
( as performed by Willie Nelson, Brenda Lee, etc, etc )
O they tell me of a home far beyond the skies,
O they tell me of a home far away;
O they tell me of a home where no storm clouds rise,
O they tell me of an uncloudy day.
O the land of cloudless day,
O the land of an unclouded day,
O they tell me of a home where no storm clouds rise,
O they tell me of an uncloudy day.
O they tell me of a home where my friends have gone,
O they tell me of that land far away,
Where the tree of life in eternal bloom
Sheds its fragrance through the uncloudy day.
O the land of cloudless day,
O the land of an unclouded day,
O they tell me of a home where no storm clouds rise,
O they tell me of an uncloudy day.
O they tell me of a King in His beauty there,
And they tell me that mine eyes shall behold
Where He sits on the throne that is whiter than snow,
In the city that is made of gold.
O the land of cloudless day,
O the land of an unclouded day,
O they tell me of a home where no storm clouds rise,
O they tell me of an uncloudy day.
O they tell me that He smiles on His children there,
And His smile drives their sorrows all away;
And they tell me that no tears ever come again
In that lovely land of uncloudy day.
O the land of cloudless day,
O the land of an unclouded day,
O they tell me of a home where no storm clouds rise,
O they tell me of an uncloudy day
Posted by | December 6, 2007 3:49 AM