Monday, May 01, 2006

The Wimpy Bull

Well, how's this for a contrarian indicator? The esteemed newspaper Barron's had this on their front cover:


Complacency is now complete in the public's mind! (I guess the grumpy bear in the lower right are readers of this blog!)

Anyway, for most of the day, the bulls were in charge, especially in the land of oil, commodities, and gold. Copper and gold have just gone bananas. Anyway, the Dow had a nice healthy 40 point gain for virtually the whole day, until big-eyed Maria B. mentioned Ben Bernanke felt the public had misinterpreted him as an interest rate dove.

The mere second-hand mention by a reporter of the chairman's finessing of his statement caused the market to unravel in a matter of minutes.


Is this really the snorting bull that's going to push the Dow past 12,000? This is a weak-willed, lily-livered bull. Any little risk, and it runs for the hills. Added to which, oil and gold are so stratospheric, when those eventually decide to come back to earth, it's going to be another big negative pull on stocks.

By the way, here are my current positions on which I am long puts:

$SPX
AHC
APC
ATI
AVB
BHI
CLF
CMI
CRS
ENER
EXPD
FLR
IPS
IWM
IYR
JOYG
KMI
NTRI
NUE
OIOH
PD
UBB
X

I don't do much FOREX in this blog, but I wanted to mention that EUR/USD looks like a good short. I'd put a stop in at $1.2931 on this one.

10 comments:

dsantos said...

Tim, I thought the same Saturday morning when I saw that thing... Barron's, the last bastion of bearish sentiment has turned... The Bull is officially dead. There is no one left on the sidelines at this point.

Tim Knight said...

I wanted to apologize for everyone for how long tonight's posting took. (*#*(#*)(*^%()# blogspot was having some kind of technical issues. Grumble....

Mantra said...

NUE: The stock could be ready for a nother leg up here, since it has pulled back to the top trend line starting approx (8/2/05 - 2/7/06)

X: This stock has hit the trend line starting approx (5/18/04,10/19/04,4/12/05-5/12/05)
and has not crossed over yet. Potentially a short.

Industry is undergoing major consolidation all across the world, giving big players more control over price, hence providing the bullish bias.

Hurricane5 said...

Holy cow did you mention NTRI and puts on the same page? I have followed this stock for a very long time and have been dead on with my price targets each and every time. I will reiterate (as I have done several times) that in 2006 NTRI will go to $80 as a weigh station to $120. Yes, NTRI will trade at $120 in 2006. People do not understand that they will earn $2.20-$2.40 per share. They deserve a multiple of 50-55. That is how I come to my price target of $120. Which puts have you been buying on this stock?

costas1966 said...

Tim, you forgot to mention Steven Roach, the Morgan Stanley economist. He was bearish since the bottom of the market in Octomber 2002 and he turned bearish today. Another contrarian indicator from a perma bear that is now a bull.

Also your bullish call a couple of weeks ago was another contrarian indicator, even though that indicator was only good for one or two days if I remember. But I know you only did it so you can appease the pain in the you know where, Hurricane 5. Or maybe you thought that Hurricane 5 after he would see you turned into a bull he would move to a different bearish blog to be a pain in the wazoo there. But to no avail the plan did not work, those 2 days was not enough time for him to pack and go. Oh well it was worth the try.

wagsaly said...
This comment has been removed by a blog administrator.
wagsaly said...

Tim,
Thanks for the list of your long puts. I didn't see DNA on the list though. Are you still bearish on it? I have puts on it and I just wanted your insight. Thanks for the Barron's cover...what a hoot!

Tim Knight said...

Regarding DNA - - I still think it's a great short. I (stupidly) closed it out for no good reason, and it looks like it's doing just dandy - it's down nearly 3 points this morning alone. Congrats!

PB said...

what is the point in being bearish in this market if all it does is go up on seemingly bad news??? It'd be a lot less painful just to go long!

tjones said...

what about ADSK puts?