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Stonks for the Long Hole 2/25/21

This is a syndicated repost courtesy of Stool Pigeons Wire at Capitalstool.com. To view original, click here. Reposted with permission.

Bonds are crashing. Will stonks follow? My answer to that question since I began forecasting a bond crash months ago has been, Yes.

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The question is when.

That I can’t answer, which is why I do TA every day. I’m always looking for those signs of trend change.

Last week I wasn’t getting them. I doubted that the selloff would stick, so with my weekly chart picks for Technical Trader subscribers, I ignored the many stonks with sell signals from the screens, added no shorts, and kept adding longs. I did so because the sell signals were virtually universally in the context of uptrends. That usually means you get a short pullback, then the BTFD crowd comes in and the rallies resume.

Which is exactly what happens. I’ll short em, when those uptrends have built top patterns. Before that, trying to pick exact tops is a fools errand. OK, I’m a fool, but I’m lazy. I don’t like to do errands.

At this point, my decision to avoid shorts and add longs looks to have been the correct judgement and strategy. Many of the 14 longs that I added to the chart pick list two weeks ago, and the 5 more last week did get stopped out in the selloff. But those that have remained are running, and have made up for the small stopout losses.

I’m definitely on tenterhooks here, however. I’ve given all of the picks simple trailing stop formulas raising the stops by a fixed amount each day, following the trendlines upward. A hard down day would take most of them out with nice profits. But if the market keeps running, we stay in and ride the trend, until it does break.

As a young man looking to build my fortune for a wealthy retirement****,

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Lee- in front of the Croatian central bank last summer, for a Croatian business magazine.

***Attention new guests. This is a SARCASM ALERT. Repeat. This is a SARCASM ALERT.

I have been using the daily technical screens for my own trading account. Early yesterday, seeing opportunity, as a new acolyte of Ron Germy Segal, of the the Whoreton School, at the U of P, I  built a broadly diversified portfolio of STONKS FOR THE LONG HOLE.

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They ended the day nicely profitable. I am nervous as shit about it. But, like my underwear, I don’t want my stops too tight, either. You need to give the things room to breathe, both in your underwear, and your stonks portfolio.

At least for now. The 5 day cycle projection yesterday was 3945-50. That has now risen to 3970-75.

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Click to engorge

The measured move target of the inverse head and shoulders breakout was also 3975. Do I think we’ll get there? Well, I hate to say it, but since I’m holding only longs, I hope so.

But alas, hope is the enema of the trader.

We know what comes after the enema.

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This is a syndicated post, which originally appeared at Stool Pigeons Wire at Capitalstool.comView original post.

Wall Street Examiner Disclosure: Lee Adler, The Wall Street Examiner reposts third party content with the permission of the publisher. The opinions expressed in these reposts are not those of the Wall Street Examiner or Lee Adler, unless authored by me, under my byline. I curate posts here on the basis of whether they represent an interesting and logical point of view, that may or may not agree with my own views. Some of the content includes the original publisher's promotional messages. No endorsement of such content is either expressed or implied by posting the content. All items published here are matters of information and opinion, and are neither intended as, nor should you construe it as, individual investment advice. Do your own due diligence when considering the offerings of information providers, or considering any investment.

Lee Adler

I’ve been publishing The Wall Street Examiner and its predecessor since October 2000. I also publish LiquidityTrader.com, and was lead analyst for Sure Money Investor, of blessed memory. I developed David Stockman's Contra Corner for Mr. Stockman. I’ve had a wide variety of finance related jobs since 1972, including a stint on Wall Street in both sales, analytical, and trading capacities. Prior to starting the Wall Street Examiner I was a commercial real estate appraiser in Florida for 15 years. I was considered an expert in the analysis of failed properties that ended up in the hands of bank REO divisions, the FDIC, and the RTC. Remember those guys? I also worked in the residential mortgage and real estate businesses in parts of the 1970s and 80s. I have been charting stocks and markets and doing analytical work since I was a teenager. I'm not some Ivory Tower academic, Wall Street guy. My perspective comes from having my boots on the ground and in the trenches, as a real estate broker, mortgage broker, trader, account rep, and analyst. I've watched most of the games these Wall Street wiseguys play from right up close. I know the drill from my 55 years of paying attention. And I'm happy to share that experience with you, right here. 

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