Sunday, July 26, 2009

Tickerville Tape Talk 7/26/09

QMan at Tickerville reminds you to trade the traders, not the macro fundamentals...

Some of the sectors he thinks attractive happen to coincide with mine. Specifically, he seems to be looking at sectors which have been dismissed or neglected by traders: commercial real estate (people just want to short), financials, commodities (industrial metals, oil, but NOT ag). He likes retail, too. NOT because of fundamental reasons but market psychology (i.e. other traders).

If you haven't noticed, in this 2-week rally, commercial real estate and financials didn't materially participate. Check the charts of ETFs - IYR for commercial real estate, and XLF for financials. They basically went sideways.

I have NRO (commercial real estate) and FAS (financial 3x long), and I've been sitting on MTL (iron ore) and DXO (oil). I hope Qman's right.

In the video, he said one interesting thing. He said the bearish patterns like head and shoulders ended up breaking to the upside, instead of down. Maybe that's a sign of a bull rally. Or maybe it's because of High Frequency Trading feeding frenzy...

If this rally has more legs, "everything will go up, at least initially", according to Quint. I agree. Just know when to quit. (If that's easy....) Whatever will be, will be...

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