Friday, June 29, 2012

USA: July 4, 1776 - June 28, 2012

Yesterday the Supreme Court of the United States ruled that the federal government has the authority to tax/fine/penalize citizens for not doing something. In addition, Chief Justice Roberts speaking for the majority opinion noted specifically:
"It is not our job to protect the people from the consequences of their political choices."
In other words, mob rule and its inevitable offspring, dictatorship - precisely what the Constitution was meant to prevent - are now the law of the land. The Constitution no longer applies at the most fundamental level. I see almost no theoretical limit to which inactions can be penalized, nor how large the fines can be, so this pretty much opens the door to total government control of our lives. It was an amazing and unprecedented 236-year experiment in liberty, but all good things eventually come to an end.

That, as they say, is that.

Friday, June 22, 2012

All cashed out

I'm back to 100% cash in my account, but I'm not yet convinced that the next rally is underway. I'm still waiting for market indicators to align one way or another.

Tuesday, June 19, 2012

Selling HDGE

Yesterday and today I sold off 50% of my HDGE shares. Today's sale was a net loss. Presently the S&P 500 index is trading above the key support/resistance levels of 1343 and 1359. If the S&P manages to close above 1380 then the next rally will be officially underway.

Friday, June 15, 2012

Of course

The S&P 500 index has closed at its highest level in a month (1343), which compels me to start cashing out of HDGE on Monday. Unfortunately the timing of this potential rally onset couldn't be worse, because Greece is holding elections on Sunday which may or may not trigger a meltdown in Europe, which in turn may or may not cause U.S. stocks to start sliding again. Even without the threat of global meltdown triggers, market corrections are never simple, and it's nearly impossible to time price bottoms perfectly.

Thursday, June 14, 2012

Key price barrier

The S&P 500 index has risen to the 1325 level several times in the past four weeks but has been unable to decisively rise above it. (It only closed above 1325 once on May 29.) If the S&P manages to finish above that level two days in a row, it might signal the end of the correction and the start of the next rally.

Monday, June 11, 2012

Another day, another quote in the Wall Street Journal

... OK, actually this is the first time I've been quoted in the WSJ, or any financial periodical for that matter! Thanks to Jonathan Cheng for this honor.
Bearish ETF Drinks Up Bad News. ... Jody Wilson, a 45-year-old planetary astronomer and amateur stock trader, said he had been waiting "for years" for such an ETF ...

Friday, June 08, 2012

Checking the parachute

If the S&P 500 index rises another 10 points or so from today's close of 1325, then that will be one indication that the correction may be over. Some of the indicators I watch are reaching extreme levels that often occur at the bottoms of corrections, but not all indicators are there yet. If the S&P climbs further and/or more indicators give "bottom" signals, then I will start to bail out of my HDGE positions.

If I do end up selling HDGE at these prices then it will result in a disappointingly small return for me. This correction had a lot of promise at the beginning, and I expected it to fall further than this, but I've never claimed to be a perfect forecaster.

Thursday, June 07, 2012

Again.

For the second day in 4 days, the S&P 500 index zoomed around and then returned to within exactly 0.14 points - or 0.01% - of its previous closing value. On Monday the S&P returned to 1278, while today the magic price was 1315. Supposedly today's action was driven by the early hopes, later dashed, that the Federal Reserve Bank would start another round of counterfeiting, or rather diluting your bank accounts, I mean "Quantitative Easing." Yeah, that's it.


There's nothing to see here, folks. Move along.

Monday, June 04, 2012

Market manipulation? Bank on it.

Do you remember the strange five-day stretch two weeks ago when the S&P 500 index closed at 1316, 1317, 1319, 1321, and 1318? Well, that wasn't the end of its strange behavior. Today the S&P gyrated between 1282 and 1267, but ended the day only 0.14 points - or 0.01% - away from where it started the day near 1278. This is all the more improbable given the bad economic news coming out of both the U.S. and E.U. today.

Sunday, June 03, 2012

So far so good

The stock market correction continues. Right now the S&P 500 index is near its lowest point in five months at 1278, and not surprisingly HDGE is at a five-month high.

Although I expect the S&P to bottom-out near 1200, meaning HDGE will gain some more, I'm not going to hang on to my HDGE shares blindly. If I see turn-around signals in the market earlier than expected, then I'll sell my HDGE shares sooner. Hopefully I cash out with a decent gain either way.