MG, I love your Left: Right Colon Hypothesis!
I think it could make a best seller!
However, I believe that it requires two modifications. First, bell weathers change over time. For example, I totally agree with you that in BKX, C is the current darling. Is it an aberration that Rubin came aboard after the legislative change? However, earlier I would have thought it was CMB.
The second issue is that it may be more advantageous to look at the movers in the sector. For example, it sure seems that when BKX is getting killed lately, BAC takes it on the chin, and vice versa. The point is: who are the turtles (decay/move less rapidly) and who are the rabbits. For example, in drugs it appears as MRK: SGP; in retail, it seems WMT: BBY. What thinks you?
The third issue I previously mentioned. There seems to be a third tier (and probably fourth) that even moves more. For example, when telecom is running, TG's SFA seems to run even more.
I really wish that I had more time to play with issue.
I've almost recovered, mentally more than financially, from my stupid entry into the softer side; but, boy did that hit the pocket book. I've come to the conclusion that this. like many games, is mostly one of confidence.
What now? As I noted to JT last year, December over the last ten years has been generally flat. Of course, no sooner stated last year and December was parabolic. In fact, it was last December when COMPX, and many of the Big Boy NAZ stocks, broke their monthly trend lines to the upside. Down is a long way!
FWIW, I've got my OEX short-term pivot point at 745.75. As long as we stay above this line, I see no reason to fight the tape. That said, the Phleet has enjoyed about 10% in the last couple of weeks in about 5 trades with all exits being premature as usual. Nonetheless, today the Phleet was in port, as I just couldn't convince myself as to any entry point; although a 7.6% gain on one stock was not realized because I was a 1/16 of a point too greedy. Ugh!
I agree with your call of extreme volatility for this month. I also think that it is important to keep in mind that since 7/2 (just a date -- but 5 months ago), the SnP is up a Big Bad 1%. The media will constantly remind us that the Naz is up 50%+, but the reality is a bit different!
Also, FWIW, I calculate the "Market" to be over-valued by about 35%. Ride the Wave, but Jack be nimble!
TB |
