Jack, Mohan, Threaders: FWIW , today's trading is making me
more nervous not less. As much as I would like to go unhedged
and return to my long exposure of pre-August such a rebalancing
is not yet in the picture for me.
Most of today's rally has emanated from the S&P500 futures pit
where at least three major buy programs resulted from significant
deviations above fair value this morning. By itself this is neither
"good" nor "bad" but rather reflects (a) significant institutional activity at the MERC or (b) speculative purchases to challenge the technical stops placed above 955.0 and attendant short covering.
My outlook is still predicated on tonight's AMAT CC and tempered
by continuing evolving risk of deflation. While Japan was up 2.94%,
most other Far East markets were down, many significantly such
as Malaysia -11% and Indonesia -4.7% (despite IMF support.)
Commodity prices are still declining with gold down, oil down,
grains steady after a down day due to reduced export demand,
and the CRB down. If this scenario continues demand for computers
from the Far East, Europe, and potentially the US could also decline
even affecting additional capacity plans for chip manufacturing. On
top of this, the yield curve continues to flatten.
In this environment, stock market rallies without positive economic
validation will occur without me as I will completely exit the long
side even in my core portfolio. BWDIK.
Good trading all. |
