Strategy for this Week

The strategy is no longer "buy microcaps that go up 60% in 2 days". It's now, fight for survival. The market is at a pivotal point and will shoot 50 points on the s&p either way, very soon. The big data comes this week via HD on Tuesday. Home Depot posts quarterly results and their outlook on housing will be vital to the market's next move. Housing is what got us into this mess and will be what pulls us out of this mess. I will be on the HD call Tuesday morning and will be listening hard. Lowe's reports tomorrow but in my view, they are geared more at the consumer, not homebuilders, so I am leaning more weight on HD.

Going forward, I don't think we will retrace to 666 on the S&P but many bears are calling for 6,000 on the DOW. It's possible but I highly doubt it. How far we go, seriously depends on how much fear will be created in the market. The VIX is at 33 and if we see a 3 or 4% downward move in the market, the VIX will print 40, creating a 7 point day move. The volatility is not bad yet but it could pick up.

I will be adjusting some of my positions for 6 months out. In addition, I will be accumulating ETF's aimed at particular sectors and select emerging markets, as well as using LEAPs strategy to play select sectors. I don't want to get to detailed yet but will post my buys and thesis behind it soon.

I think the "reflation" trade will be big during the next 12-18 months; therefore, I will weight more portfolio towards oil, basic material, and commodities. In addition, I will purchase gold bricks and buy a safe to hoard them in (kidding but not really). Gun sales are through the roof and Beretta said that alot of their handguns are backorder through 2010! SWHC and RGR are both up triple digits and may move higher. I have been looking at CAB but haven't made a purchase yet. CAB is up huge from yearly lows of $4 to over $12 now. However, insider buying is going on with one director purchasing $2 million worth of stock over $13.50 a share. Cabela's is a big player and it might be worth a shot.

Lastly, I am not a market predictor but have timed things well so far this year. Last week was my worst week of 2009 because I was loaded in small caps and most of my profits fell off a cliff. I will probably dump most of my small junk (BEE, FMCN, and GMO). FTK and SFE are on the tight walk but SFE is a value play where most of their investment portfolio seems very undervalued. I posted my views on FTK on Friday (scroll below). I am keeping the small junk, just in case shoot back to 925, I have some bullets in the market and they will explode back higher. I have a high cash position and am ready to deploy capital like a "madman". I