Is it taboo to short black gold?
Since I think gold has lots of room to run before the world loses confidence in the shiny stuff I have taken to looking at other short vehicles in sectors that aren't going to squeeze my brains out on any given Monday.
I am looking for a short-term swing for a basket of "value stocks" that take it on the chin on days like today (VLO, SAY, CSR, T, S, ETFC and MWA to name a few). Yes, one has to take the good with the bad but I don't want to take it lying down and I don't need to be trading in and out of these positions trying to guess the weekly fluctuations.
For 2010 I am still bullish on equities in general. On these pullbacks I want to start buying into some quality stocks to like INTC, AAPL and LUK. I have a Precious Metals mutual fund but feel like I have enough exposure in that area.
Based on what I have been seeing, reading and hearing the one stand out sector that appears to have more risk than reward these days is Crude Oil. Fundamentally and technically we appear to be hitting the "canopy top" that Art Cashin described at S&P 850 or so (the canopy was soon thereafter destroyed). There definitely are some factors that could lead to a spike but overall we seem to be at resistance and oversupplied.
No one has paid much mind to oil these days but more and more analysts seem to be slowly backing away and heading to the exits. A report I saw today feels that Oil could be the biggest surprise of 2010...at $60 ppb or less...the same report sees the S&P at 1200+
Yes this is pure speculation on my part but if nothing else my prediction is that Oil will underperform the S&P500 in 2010. If it means the market comes down with it I hope I am wrong! : )
I am playing this with SCO in a basket that is 90% long. I lose big if Iran plays its trump card starts popping pipelines...if we get a pullback Oil runs back hard and I get some insurance in my fund...if the rally resumes it underperforms...