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Friday, June 5, 2009

Are bears afraid of bulls?

Are bears afraid of bulls?

Why yes I am. However the higher this market goes the greater fall it will eventually take.
To ensure I have the purchasing power to "add" to my positions when the market feels topish, I need to start covering risky shorts, and sell some of my lottery tickets to reduce risk.

NOTE: I am keeping some positions on all shorts and lottery tickets, just reducing size. My sizes are probably too high for the risk right now. At this point, I would rather miss opportunity than get forced out of positions by a short squeeze.

SPX 1050 is the target, and I don't believe we will see it. But then again, I thought after hitting 200 DMA the market would pullback.

All the blog entries on shorts and lottery tickets are still my longer term plan, but re-positioning to minimize the risk. Gold miners are doing great, since that is about 1/3rd of my position, helping offset any short risk I have. Gold target is 1000 to 1325 an ounce, which should rocket all gold miners up.

4 comments:

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  2. Hey Murph,
    I caught Jim Rogers at lunch yesterday on CNBS...

    http://www.cnbc.com/id/31106964

    He had a few words on shorting the market. Basically you can't trust what the govt is going to do. They could print it to Dow 20 - 30,000.

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  3. I agree with Jim Rogers in the long term, hence resource plays are my primary investment.

    BUT I disagree that the government will allow this to happen, they know this leads to disaster.
    So what I believe will happen is the government tries to contain inflation, one side effect is market falls much lower. THEN inflation.

    If the DOW hits 4-5K or lower, the "Defense" for why we caused inflation will be "look at where the market was, we had to try".

    I don't think the markets have hit far enough into crisis to justify the debasing of the dollar on a massive scale that we will eventually see.

    But then again, what do I know?

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  4. One other point. Currency vs Currency, the US is NOT that bad off, atleast if you look at Euro and other western currencies.

    What the USD will lose significant ground to is asian currencies. Many don't have the debt that western countries do.

    So USD vs what? Gold, USD loses. Euro? May be a wash.

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