Selling short this from here is all about timing, I think there is still a bit more time to go, this initial Cyprus news sell off will be probably bought back up... I see the first week of May to start for a deep correctIon... We have a recession or near zero growth at the moment, the market will eventually reflect the valuations, perhaps it will crash, USD rallies up, commodities are selling, so the signs are already there with the breadth weakening...
I think if we sell on Cyprus news, that is if runs on the banks start in Spain, we'll try to bounce back into the Fed meeting Tuesday/Wednesday, so the Fed could reassure everyone once again. Then Thursday night is China and European PMI's, if China PMI drops back under 50, which I think has a very good chance, based on other data, and European PMI's will continue collapsing, then we'll get a start of more serious selling. And of course earnings season starts April 8th too. And we'll find out what earnings growth there really is. I suspect not very much. Thats an approximate roadmap, the way I see it.
Wonder if Euro cracks down next week too. Will also be bad news for commodities and the rest of the market. Rallying dollar is a big headwind for all these large cap multinationals.
Aside from that, Euro is most likely done. We now know what Draghi's "whatever it takes" means. And I don't think Spanish or Italian voters are gonna like this. I think dollar is in a bull market as all the crappy currencies around the world start folding. And Euro debacle threat is growing by the hour.
Either way, will I be right or wrong, and the magic summations will never turn down against the laws of mathematics and gravity ... the risk of being long this market is very substantial at this point
Edited by ogm, 16 March 2013 - 11:02 PM.
