Sunday, November 27, 2011

Market Analysis for Week Starting Nov 28

Markets are screaming "HELP" after last weeks sell off. We have recessions fears in Europe and the US, while China will slow down and risks social unrest. Euro bonds Exploded higher while US hit record lows. US 5 year trades under 1 % at .88 basis points, the 2 year at .26 basis point and a 10 year treasury at 1.88%. Markel is trying to force a deflation spiral on the worlds economy. Despite the overwhelming evidence that Deflation doesn't work! At this point no fundamentals, Technical, math or logic seem to matter. The Market has decided to send a strong message to the EZ to stop their lunacy. Markets are becoming more and more immune to these stupid little BS roamers and small signs of hope. The clock has started to tick with each new low the markets make. Markel better be listening!


Last week I started out with 40% exposure to the market net long. I got stopped out from the word GO! Luckily the Shorts outperformed the Longs and the pain was minimal. By the end of the week I was up a bit as I reduced longs and added to shorts. Friday we got an extremely weak bounce that failed as a lot of charts were hitting support areas. This is a big tell, tell sign of just how bad things are.

Looking at the week ahead SPY gets a Neutral rating. Despite the fact we are in extreme oversold territory.  We are deep inside the Chop area where violent moves in both directions are typical. Newbie traders Should definitely be in all CASH! There is no glory in losing your hard earned money guessing. Remember Bottom Fishing is a FOOLS game!

I am entering the week with 26% of portfolio exposure Net Short. I will continue to hold short names like CPA, ALK, SLV, GLD, APKT, LULU, DBA, AMED, IT etc. While holding on to longs like AAPL, BA, WDC POT, ISRG, WFM, CMG, WCN etc. I will look to buy some SPY down around the 114 area for a bounce should wee get there and Short around the 122 area.

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