What a day, what a day. The cyclical bear market is confirmed.
The slow grind in major indecies today was just astounding to watch. It was this amazinginly orderly destruction of wealth that just slid down all day long. Unreal.
Anyhow, I did pretty darn well today. As I type this the papermoney account is sitting nicely with $211,325 in cash, close to a 33% return this year alone. This afternoon I closed down the SPY(134.54 +1.86) and FXP(22.06 -0.68) positions, and have entered a buy order to purchase 50 SPY(134.54 +1.86) March 75 Calls.
Yes, you read that right. I am getting ready to get long. This may come back to kick my butt, and if we break under the 73 level on the SPY I’ll kill this trade and take my lumps. However, we have closed down six days in a row now and the odds are strongly in favor of a relief rally.
Don’t get me wrong, the market is still going to grind retirement acocunts into hamburger over the next two years. Wave 5 of and EWT cycle is ugly, and this is it. We are in the big bear, and it will take a while for this bad boy to destroy massive amounts of wealth.
If you can, get short, hedge and get protected. My 401(k) is getting killed, my investment options – all but one are down 30-40% over the last 12 months. How can you have a balanced portfolio when you cannot buy any insurance? No puts, no short funds, nothing to actually hedge aginast the market.
Oh well, the good news is that my personal account is on the rise. I am not offsetting the massive losses in the 401(k) yet, but if I am able to keep only 1/3 of the rate of return I’ve been pulling down this year it will be a very, very good year.
Comments on this entry are closed.