At Some Point, Will Need a New Playbook

Woke up this morning and my eyes were about swelled shut. Sinus pressure is bad! Had to take the day off and go the antihistamine route. Feeling a little better now.

At Some Point, Will Need a New Playbook

2012 has started very positive and markets are very happy. Across the board enticing setups are showing up and fear has taken a back seat. Sentiment is running heavily towards the bullish side and action has followed suit.

For the last 5 months of 2011 this has always been a spot to get skeptical and very light or even outright short. At some point this will change and the playbook will have to be updated with new ideas. chessNwine has an excellent recap video today that discusses what may happen going forward this year; a market that rewards the best set ups and stock picks instead of a mass risk on/risk off sort of thing. You can see the recap here.

Looking things over today I was faced with one of two decisions, open up some long positions even as things are extended here (the two indicators I follow Robert Sinn's SMS and the PPT Hybrid score) or use the same old play from the old playbook and take a shot at a short position. I chose the latter.

I bought TZA about 15 minutes before the market close. I did this for two reasons. One was the blog I wrote last night about the last gasp rally to S&P 500 1295 or so. The gap up today had that well in play. The second is that I am feeling pretty ill and it would be easier to manage one position than carry 2-4 positions especially around earnings season where you have to check across your stock buys industry in case there is news that affects your position.

In either case, it should be readily apparent what is going on should TZA continue to fall part here. If a sustained move up is on the way, I feel that there will be great room to the upside in many names and I can play it out going forward that way. Top picks are TTEK, DFS, and INTU.

Have a good night.