Jane, Jane, Jane...
re:
["Slider, ask Isospook for me IF he is ever going to call his buys and sells in REALTIME??
Thx,
Jane"]
... in all seriousness; he does all the time. He made some nice trading calls on some "Homeland Security" stocks & some defense stocks before that and made a nice call on the Gold Lease rates here of late.
Iso's a big boy... he doesn't need me to defend him, or his record. But, you guys (and gals) are missing the big picture - as in the MACRO calls.
Part of the problem is that many of you seem to have more of a daytraing mentality than we do. Many of you have gone to a quicker turn trading mode than many of us have at SI SD II. We're not daytraders... but, we're not LT buy & hold players either. T
he patch and tech have had lots of volatility... enough to daytrade on the technicals alone if that's what you want to do.... I just think that's a very hard thing to do - over long periods of time...and it's not my thing.
Personally; I swing trade - play the subcycle trading ranges and I like to "beat the crowd to the party" - and then "be among the first to leave - never, ever - EVER being caught hanging around at last call"...
I'm attracted to cyclicals equally for both longsided & shortsided trading opps. Cyclicals if you live & learn them 24 x7 - owe you as much money on the downside as you earned on the upside.
And never fall in love with your stocks... these aren't the HOME TEAM - they "aint" the Yankees and they don't play in the shadow of Touch Down Jesus & the Golden Dome...they are just little pieces of parchment paper, or electronic debits & credits that you make money with... it's okay to love 'em one day & hate 'em the next...and you actually get paid very well for loving 'em & leaving 'em.
I honestly think many of the chihuahua crowd just can't digest the fact that the oilpatch cycles are probably going to be shorter & more volatile than in the past. And I don't think it's been an unfair characterization, or criticism - in saying that far too many people are approaching oilpatch CYCLICALS like traditional growth stocks.
These are NOT buy & hold plays.
Cyclicals if traded properly are also the epitome of contrarian plays.
Actually; they are contrarian-contrarian plays if played well; literally being a sector where one must "trade the traders" at times more so than the fundamentals.
You also have to keep one eye focused on present fundamentals & tape action and the other 6-12-18 months out... but, you just can't "look" 6-12-18 months out... you have to anticipate both what the Macro economic's & fundamentals will be & also how the "traders" will react to that same picture - 6-12-18 months out.
You've got to continually be trading "in anticipation of" and not "in reaction to" the tape, the fundamentals, the macro economic picture and perhaps most importantly; the traders themselves... as winning in cyclicals imho; is all about staying ahead of the money flows.
In the patch - that money moves like a herd of elephants thru the eye of a needle on occassion... ie: in the Spring of 1999 the OSX ramped 50% in like 14 trading sessions when the up cycle broke out and this summer it fell from the 120's to the 60's in 90 days when the June Swoon part deux arrived.
I also think that the average trader does a far worse job exiting at/near the top... than they do getting in at bottoms.
I believe that's because to exit at a shareprice top in cyclicals - you need to begin forming an exit strategy at about level # 7 on a 1 to 10 scale of the cyclical buildup in both sector sentiment & fundamentals... ie: you not only have to be early - but, you've got to be real early & literally; if you don't get chastised by the masses for "missing the boat" when you begin to exit... rest assured; you're too late.
The other significant mistake I see made is that far too many think they allways have to be "in"... or be trading something, anything...all the time.
Sometimes there are points in the cycle that are the "deadzone"... ie: banded trading ranges offering poor reward to risk ratio's/opporunities.
That's where we are right now in the OSX imho.
Sit them out... make the sector & the stocks come to you... wait, be patient... don't chase, don't force trades & don't keep staring at the tape untill you see what you want to see.
Other than War & an Oil supply disruption event... there are no nearterm upside drivers to take the OSX significantly higher & out of this trading range imho.
The risk & the bias remains to the downside imo.
The still slowing global economies are the trump card here.
Hence; just mainly some "calls" as a leveraged hedge to War & an Oil Supply Disruption...and then patiently waiting to average in, or flip some trading profits into building a core LT positon in that bottom value band of OSX 45-60 which has allways proved to be very profitable LT as an entry point.
No reason to watch the tape on a daily basis here imo... unless you are literally a professional daytrader & I kind of think that those remaining are an endangered species, if not in reality, allready extinct.
This is a great time to take a break if you're not a professional trader, trading full time for a living - as "it just aint there" imo... so , why fight it, or force it... have a couple of fishing line "gtc buy orders" hanging out there if you're close to targeted buy levels and take a break...
Swing trading makes the most sense in cyclicals imho and the BIG & EASY money is made at both ends of the cycle and the final 1/3rd downside of the cycle - of which we are now imho; is the worst reward to risk part of the cycle.
They'll be a couple of nice DCB trading runs off of most of the downside blow off's in that 60 to 45 range.. but, from 60 to 90 is whipsaw-city in this environment imo
...patience, cash and a lot of Gold & Silver stocks.
Black Gold's day will come again; but it aint here yet.
30-90 days is a longtime in the 'patch and if we get a continuation of warm weather into this Winter & Russia and OPEC play this game of Chicken... remember, it won't take much for the "paper traders" in the commodity pits to take Oil to $10 to $12 in this environement.
... keep the Big Money on the sidelines untill the "paper traders" in the commodity pits - overswing to the downside... it'll happen; allways has, allways will... and it looks like it's coming again soon, baring any Mid-East fire works....$16, $14, $12 ? - $10 Crude anyone ?
Can't happen ? - Won't happen ?
And "if" we do get a "War/Supply Disruption" Trading pop - are you willing to take quick profits (dump those crude levered calls) & spin short again ?
...looking the prospects, if not at least the possiblities of $10-$12 Oil and sub $2 Nat Gas in the eye here; whodathunk that just a mere 10-12 mos. ago we were in the midst of a new paradigm - the beginnings of a multi-year Oilpatch Expansion cycle... with California ready to take down the entire Power Grid and Simmons & Co preaching the mania-mantra' and the Street buying it... ?
Ciao` |
