Monday Morning Quarterbacking

Not as in looking back but as in dealing with the news here and now. A quarterback in the market plays on Monday not on Sunday...

Market up big today but fundies have not changed. Housing increase may be something to watch but more is needed to change thesis. Large price declines bring slightly higher than expected sales. This is not great news for the sector but people are so desperately looking for a bottom in housing and shorts are very afraid of anything that can even fictitiously hint at a potential bottom.

I did not buy SRS and would wait for it to drop into 80s under these circumstances. I was stopped out of TWM on my small position at 79.79. The DUG is down also. Again I did not take a very large position on Friday because there was too much uncertainty over the weekend. I have a stop set for 39.37 on the DUG.

This is set to be an up day. Don't fight today's tape. Just wait for the dust to settle and then realize that whenever the DOW has gotten near 12,700 it is likely to shoot back down in the near term. TWM around 78, QID under 50, SRS in the low 90s now.

The news of today is not a catalyst but a short-term influencer in my opinion.

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On the long side the Chinese stocks have rebounded nicely. China Medical is up not just becaouse of the overall market but more importantly because they just got CE approval in Europe for some of their ECLIA products. This gives them a new market and also lets the world and China know that they produce quality products that are suitable for any country in the world. And they can do it at a much lower cost than many companies in the West.

I'd call that big news going forward. This is exactly why I would not sell my core position in this company. It's too undervalued, has nothing to do with the economy, and has enormous growth potential. Stocks like these can take off at any moment. They may fall back in the short-term but earnings will drive this company higher. Some companies are worth the wait...

Other longs:
SDTH up big after overcorrecting. I didn't get a chance to listen to the CC and I know they only "met" expectations but I will listen. This company is tied to the global economy but their products actually make others cheaper and they are a very very strong long term player as well. Still I will stay away as long as the market is on a downward trend and look for trades like today which I admittedly missed partly because I am doing other things at the same time.

CROX and DECK up big
GIGM up big.

Many others. Do you think they stay up here for long? My guess is not but I wouldn't fight them today.

NYX also. I sold it at 61. On a different day I think it goes back to the high 50s but we will see. I have no faith in the resiliency of NYX in a bear market though I do think it is way undervalued and in a better market would be at the very least around 80. The buybacks are nice but are not large enough to make a huge difference in a poor market. I will continue to keep an eye out for it.

Overall,
Powerful up day today. Bears in trouble to day. But for how long? The short ETFs are hitting my target ranges for strong buy without a catalyst to change my long-term outlook on the market.

I may get back into/add to some shorts at the end of the dayor earlier if they hit my sweet spot price targets...

I bought back TWM at 79.41 and again at 78.39.
Stops on TWM at 77.77
Best,
Jon