Outlook

So, we closed over 1,000 on the S&P, leaving us at an incredible 50% jump since the March lows! If this is not dot.com then I don’t know what is! Regardless of what the “crowd” is doing, I will remain in high cash levels and find stocks that have margin of safety and good upside prospects.

These next days will be very interesting portfolio, especially Wednesday and Thursday. EXM reports Weds and PRU reports Thurs. I loaded up on EXM for a few weeks, then it shot off..so I still hold 50% of my original position from the $6.20 cost average. I believe EXM earnings will be good, since DRYS was good but I expect volatility either way. Normally the stock shoots 7% either way. The BDI (global shipping index) has been week during the past two weeks; however, the shippers have shook it off. PRU should do well, since HIG and LNC have been on fire. It is crazy, I bought HIG 2-3 weeks ago at $10.40 and LNC at $14.90 and now look at them! HIG at $16ish and LNC at $22ish! I still have a lot of my PRU from the $33 prints but it is amazing to see how much money managers love these things are buy them aggressively. LNC is still a good one and will accumulate it back on dips.

If people believe we are trying ‘out of the woods’ the DOW will print 12,000 in my honest opinion. The only way to play this market – which absolutely sounds insane – is to pretend the market will never go down but be ready to short or go 100% cash in a second. Yeah, you heard, pretend the market will never go down but be ready to short or go 100% cash in a second! It sounds nutz but it’s the only way to trade this market besides day trading! This is a typical “drink beer and buy stocks” market and if you are trying to short, it’s smarter to go eat a bagel.

If you short, just do your HW and keep tight stops of 3-5% because margin calls suck. The futures are downwards right now, each indice down -.75%. It will be interesting to see if we are near a top of just a tiny pullback.