I figured I would take a quick minute to discuss today's actions. Simply put, this is a very sharp selloff. Frankly, it's good for the market but I wished I wouldn't sold off a few more names Friday, but oh well. For the day, I'm off but not too bad, thanks to JAVA.
I suspect that the S&P will move closer to 800 because banks fears are back in the market. I read the BAC conference call and he said many things that were alarming. One is that credit is still difficult to obtain and banks will get worse before they get better. Their quarter was unbelievable, estimates were $0.04 and they made $0.40. Clearly the merger with MER and CFC are working.
As for me, I really don't want to sell here. I think we could bounce because of earnings week. With that being said, we could also fall harder. Some good hedges that I own and like are SDS and QID. If you are fully invested, these are fair hedges. Shorting the SPY or QQQQ are also good for hedges. As for buying, I added to my GIGM position (now my biggest holding) and LVS. I also like real commodities, for a long play. As for shorts, look for the momentum names that were hot into the rally, those are normally the ones that go back down.
Lastly, for the S&P, I think we can slide to 830 and if we break, could touch 800. Trade accordingly.
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