Hard Selling At Midday

Right now, the Dow Jones is down about 225 points, or almost 2%.

I mentioned Friday to keep your beta near 0.  I’m up slightly today with the positioning I have.  I mentioned also Friday that I’m not seeing any extremes.  My bias is to the downside as we have had weak internals on the way up during this rally since July 15th, low volume, an economy that is still weakening, and confidence building (a contrarian indicator based on my crazy investor indicator).  So, given this, being neutral to slightly net short is still the way to go.  If you buy some bargains like emerging markets, just keep it hedged.  Or, just hang out in cash.

Let’s see if this snowballs and we get one of those 90% down days where almost all the volume is down volume.  Right now, it’s about 85%.  Remember that a lot of people are on vacation on the floor so the volatility will remain high this week on weaker volume.  The sooner we get a few of those 90% down days, the sooner we can get a real rally.


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August 2008
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