It's pretty clear that for the next week at least, we're going to experience a V bottom in both the dung and the dow. People have huge tax bills, and just like last year they're going to speculate until the last second hoping to make their tax money generate a little extra wealth before handing it over.
The big brokerages know this, and they're going to fan the fires with every tape painting trick they know- after all they have inventory to unload as well.
As of today's close I am long calls on MSFT/CSCO/INTC/RMBS and especially CIEN. I mean I am REALLY overweighted in CIEN. That one held up the best, besides microsoft, in the previous collapse, and that means it will bounce the hardest and fastest.
I don't see myself placing any shorts of any kind for the next couple weeks. Not even hedges. There just isnt any downside risk right now. Too many forces need the market higher. The brokerages, the banks, the fed, and the individual investors. I'm not going to be a hero and try to tell the american public that McDonald's food sucks in every possible way, or that Tim Allen's Tool Time didn't deserve to be the number one rated TV show for 3 years, nor am I going to tell them RIMM doesnt deserve a P/E of 8000. Give the public what they want. Bread, circuses, and stock certificates. Fast food, analyst freakshows, and lottery tickets. No difference.
I don't think there is anyone of any consequence still short anyway. Commercial shorts are practically non existant, and the put call ratio is absolutely gleefully long. |
