This is the second time in two weeks I missed my sell point. I guess I am slow in getting used to the bears being in control. Yes, the portfolio grossed 2% in protective hedges, but the markets gave us gifts. Here is the second in the SPY as who wanted to go home long today? No one!
Boy am I glad I went to 100% cash three weeks ago as I just don't agree with the reasons we are going higher, which is limited to QE3. If it comes and if we go higher, I will play it here and there, but I can't imagine the upside is as much as it was during QE2. I think unemployment staying high will cap the upside, but if unemployment begins to dip in a greater fashion (doubtful), then the upside could have some oomph. That is all down the road. For now, technically, use the charts to give you a good risk to reward trade with high probability. High probabilities came in forex with the EUR/USD giving two BUFFALO BOUNCES:
Looking at it on the Daily chart, we have a DOUBLE FALL LINE TRADE and now we have come off so far that we might be looking to buy the EUR/USD off a DOUBLE FALL LINE trade
Looking ahead, we have retail sales on Tuesday - I am not looking for this to be good, but all depends on how low the estimates are. Might be fun to compare the estimates versus last month's estimates. We also have lots of inflation data, but remember, the Fed said there isn't any. I actually called for stagflation in 2009/2010 but that was before QE2. I still think that stagnant growth and stagnant price pressures are coming, it is just a matter of when and that is why I manage the downside risk in the portfolio, because below expectation growth is coming.
Thanks to Park City Trading and Investing Club last evening for a great turnout and a great discussion.
Happy Trading and Be Environmentally Cool
Coach Brian
PS Go MAVS!
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