So this is what the ''oldtimers'' were warning us about - what a lesson learned...
Sometimes one just has to learn lifes hard lessons personally. Reading about 1987 or past recessions or selloffs just doesn't strike fear into the hearts of many.... but, now I have learned by experience and what a stern task master she is... I have finally been humbled here. One can not tame the beast, one can only ride the beast, but never think it is totally under your control.... No, never think that... allways remember the past, allways listen to ones elders, allways take a little profit off the table (good bye to all my August-Sept Trading profits)... And never, never stay long during the month of October in a down market year...NEVER.
If the World ever goes into turmoil, politically or financially; and especially if it does both simultaneously - go to major degree of cash , buy puts...but do get defensive.
For these stocks to sell off to these %'s at relatively low volume is margin call city. Some hedge funds are dumping for pure liquidation reasons. Not a pretty sight. We have some incredible value here, but now there is value everywhere... I don't think we are going to see sector rotation as a factor now; the oilpatch surely hasn't been a safe haven at all. We now have so many top stocks in all sectors so cheap that sector rotation will be a non event. Everything is cheap.
The small caps offer incredible opportunity here, but they may go to unfathomable levels yet...? Why buy untill the tax loss selling season is over ? The good news is not much further to go... I'll mark October's on my calendar, from now on - it will be a ''cash'' month in any down market year for my lifetime. I was totally WRONG here, in what I expected during October - we have too many stocks going below the Sept. 1 low's... Tax loss selling is brutal here and some funds losing so much on the tech and overall market selloff we are seeing total dumping here from margin calls and maybe some Clinton impeachment fears... GLBL is unreal...a literal dumping of their stock, I did buy GLBL & VRC here - but ''No Mas'' - toooo risky imho.
Shorts; congrats - pop some champagne; but I would cover and go to cash here - then go long in Nov-Dec... The majority of the shorts will make the same mistake of the longs; staying with a position too long... We will get a bounce here; and will have a huge amount of short covering ultimately; I would not want to be one of the last shorts to cover here, but obviously it is far from being over...
Makes no sense to sell into this kind of a selloff; and they are some great buys - the $64 question is do I buy FGII here at $10-11 where we had prior support, or are we going to wake up one morning and see FGII selloff like GLBL to $5-6-7 ? Bottom line is, one can't go wrong buying financially sound companies at these price levels, we may see a $6 FGII, but we will also most assuredly see a $26 FGII as well.... that's what makes this so damn fascinating...
Good Luck & Be Safe.... cash never looked so good... time to find a warm spot under the mattress ? is Y2K next ? Damn goldbugs and bomb shelter builders may have the last laugh after all "<VBG>"
PS - awfully hard for a "<VBG>" here... I saw James Cramer say he has thrown in the towel here . If Cramer says you can't trade this market - why should I think I can... between LTC being unwound, the Impeachment, International Finance, The Fed sitting on its duff here... there is no way to trade this market - So don't try - was his advice. I got lucky on a couple of bounce plays on CSCO , LU, VTSS, PMCS, but also got nicked a few points trying to repeat it as well - NOT a time to play the bounce here any longer - period. I have finally been HUMBLED here; totally HUMBLED; I will never again in my trading lifetime forget the lessons of this market, not ever... While I have fought back from the JUNE sell offs by trading heavilly here and profitably so up through this mid Sept rally - I have now lost all of those gains... and am not so ''cocky'' here any longer I am sitting and waiting, not buying yet, not selling anything else, I like what I have and will just wait untill the dust settles here...
Won't be posting for a while - going to enjoy some baseball and come back later. |
