Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
This has been a very frustrating month, topped off by today's actions. The Dow is up substantially but that is almost entirely on the back of IBM as its the most influential weighting on a price weighted index. Meanwhile many of my watch lists look like a wasteland. Financials continue to rip higher and have been the only sector in the green this morning.
"Worst to first" continues as Sears Holdings (SHLD) is up nearly 50% this week alone.
Microsoft (MSFT) is acting like Google (GOOG)…. while Google is acting like Microsoft!
As an aside, Google has been a travesty in 2012. Entering the year it had one of the most promising, if not THE most promising, technical set up among large cap tech. A multi year (not multi month, but multi year) sideways base was being broken to the upside (over $640). Then a company Google is acquiring, Motorola Mobility, warned in early January pushing the stock back down into its long term channel…. and the company went to sleep the rest of the month while the market ramped. Until last night of course, when the company bombed in its earnings report.
Meanwhile, the bulls are invading the last of the hideouts for bears…. volatility is being swallowed whole (a place you usually can go at least as a hedge) as there appears to be zero fear out there, and now even bonds are selling off. All while we are extremely overbought on the indexes.
They say the market will frustrate the most amount of people, and in this case it appears to be working. Usually when you "feel" like this, it is near an inflection point but right now any and all attempts at betting against the market are simply being vaporized and leading to continuous losses. It is like going to an ATM machine every day and handing it money, rather than pulling money out.
Wayne Gretzy said to be where the puck is going, not where it is. Certainly for the month of January I feel as if I've been where the puck was… 2 days ago.
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Any securities mentioned on this page are not held by the author in his personal portfolio. Securities mentioned may or may not be held by the author in the mutual fund he manages, the Paladin Long Short Fund (PALFX). For a list of the aforementioned fund's holdings at the end of the prior quarter, visit the Paladin Funds website at http://www.paladinfunds.com/holdings/blog
