I really have no idea what the market will do tomorrow, and I don't think anyone else does either. Except, maybe, the guys who got an early peek at the CPI number??? It does seem odd, monday's closing rally (for no reason), and the upwardly-mobile CPI consensus estimate.
All I'm sure of is: the market is not going up (medium to long-term), as long as:
1. 10 year treasuries are above 6%
2. the Fed is raising or threatening to raise
3. everyone is on inflation watch.
As long as those conditions exist, I'm going to hold enough index puts to hedge all my long positions in U.S. stocks. I'm not nimble enough to play the false rallies. I'll wait for something that smells like capitulation.
I think it's way to early to initiate any new long positions in tech companies. I've got a list, and I intend to buy, but patience will be rewarded. If you think prices are good now, wait a while. They'll get better.
The only stocks I'd consider buying now are in industries that have already been hammered into the ground. I mean multi-year lows. I've got a limit order on RIG, an oil services company. Considering adding to CMH (although they are interest-rate sensitive, it's in the stock already). Others are looking at steel companies.
If you like Dell, (or Intel, CSCO, QCOM, MSFT), they have just begun to follow the market down. NDX hit an all-time high only 8 days ago. Take a deep breath and........wait. |
