Thursday, June 11, 2009

Still No End for This Rally

Majority is wrong. It's usually wrong on the market, this is how markets work. This rally is going on for three months already, and all we hear: "Bear market rally". Come on, guys, I understand, it's hard to sit on the sidelines (never mind being short) when market is going up. But if you don't recognize the obvious, you lose money.

I expected some bullishness, if not exuberance, by now. I sit on good gains since March, and my finger is itching to press "sell" button. But there is no point in selling when there are so many bears around. Sentiment remains neutral to slightly bearing on my unscientific screen. And I remain bullish, buying more lately. All my transactions are in the blog, welcome to see them.

The end of quarter remains the crucial point. There is some window dressing going on for sure. But most of it is on the oil market, which is so disconnected from physical product now that even price of natural gas doesn't want to follow it. No panic buying in tech and financials. Mostly sideways action with little upside. That's a "buy" signal, not a "sell", not even "take profit" signal. Sure, if you feel scared sitting on 40% profit, take it. But I'm going to buy more. I don't have any stocks I like very much, so I was buying a little bit of this and that, with exception of VmWare (VMW). This one is one of the Next Great Things, and I'm buying more on weakness. Reasons are outlined here.

Full disclosure: at the time of publication author had a long position in VMW. Positions can change any time.

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