For anyone who gives a rat's a$$ what I'm up to, I sold my first large block of hedges Friday, and an equal chunk yesterday. I decided that last week's Tuesday marginal highs were good enough for me, coupled with the very lopsided sentiment data.
I'm still going gradually, though. I usually move in increments of 1/8 of portfolio, trying to get from 1/8 long toward about 5/8 short. This time, I'm doing 1/12s because my goal is about 3/8 short exposure.
The sentiment data is extremely lopsided in favor of the short side. Options premiums show remarkable complacency given the risk here. Valuations are absurd. The Fed is out of bullets, and the e-con-o-me is about ready for the dump that will make another one-term Bush president. The up is labored and choppy, and overhead resistance abounds. Seasonality is even unfavorable. Insider selling has resumed in spades, and the dollar is bringing in real overseas selling. I keep asking myself what the hell I'm waiting for.
The only things making me nervous are
1. the chart action - much of the up has been on chunky volume, acting like a cyclical bull, and no really good down has developed yet and
2. TrimTabs isn't bearish - I don't feel good fading those guys; the rationale behind their approach is quite sound
Otherwise, I'd be fully exposed to the short side. Perhaps in time.
BC |
