TCI,
The prudent action has been no action--I agree. It's what I've pretty much done, and what everyone else seems to be doing, based on the declining broad market volume we keep hearing about on CNBC. Whipsaw risk is extremely high, and I have been subject to that myself when I've broken my discipline.
I've clamped down on the discipline once more, and have expanded short-exposure to names that have deviated a little too strongly off so-called 'dead-cat bounces' to offset my current tech exposure. Of course, these issues have met my technical and fundamental criteria for the short.
Some time ago, I sold short some puts as a means of capturing exposure to names I want, but at the same time get paid for my patience. After initiating that a little over a week ago, I have not done much trading (just that dot-com short, which is down 11% today), but as the speculative fervor continues to die a slow death, my theory of price affecting price is beginning to get some play with the B2B sector.
Ideally, I am looking for a rally to short into, and as the rally fades, the wheat is eventually separated from the chaff, and it's the chaff that I focus my shorts on. Like I said, it's only in my sites, but the process for actively separating the issues that will survive and those that deserve to die is being initiated.
Rainier |
