InvestBaboo

What to Short When the Rally Dies

Well, dear Author, it sounds like you want to give the money you made by going long in March by trying to second-guess the direction of the market. That is sad.

Have you considered the possibility that the levels set in March were an unnatural overcorrection and that the true levels of the market may be much higher? Remember, the shorts lost complete faith in S&P earnings and now the earnings that are coming out are way better than the pessimistic estimates that led to the March lows. Moron Michael Mayo expected banks to puke blood and guts in their earnings however they blew it away my miles. Even regional banks such as BB&T which even I (a strong believer that the banks will generate enough cash to work their way out of this mess) was caught by surprise. The consumer has proved to be extraordinarily resilient and the Fed's liquidity moves will mean an end to the bear market.

Our troubles are not over but the Dow and S&P are not at correct levels even with the recent run-up. I don't know what the correct levels are but don't be surprised if that is Dow 9000 plus and S&P 950 plus.For one I aim to ride the trend until the bend at the end I don't see no bend at the present.