The resilience of this market amazes me. In the face of $125 oil, this market just doesnt seem to let up. Everyone knows by now how the high oil prices are adversely affecting consumers. How the high rice, wheat, corn prices are causing the average joe to pay more at the grocery store. We also know that the declining value of homes is reducing the "wealth effect" that everyone felt 3-4 years ago. Then why does the stock market act like everythings fine???
One key fact in last month's rally is that the rally has occured on very low volume. This tells me that big money isnt rushing back into the market to put their money to work just yet. I sold off the rest of my DRYS calls today for a 160% profit. It was time to cash in those gains there.
I believe this recent rally is starting to loose steam and we might head back down again. I just dont have enough conviction to start buying again and it hurts when i see this market go up everyday and i calculate my missed opportunities. But i have to stick with my conviction and not enter a position half-heartedly. Sometimes the hardest trade to make is none at all!
I executed my first trade in the Indian Stock market tonight. I have been watching the market for the last couple of months to understand the dynamics and felt confident enough to pull the trigger today. I bought some shares in an Automobile company called "Hero Honda" at 800Rs and an Aluminum manufacturer called "National Aluminum" at 450 Rs. Hero Honda just broke through its old trading range on good volume and i see it going higher.
Long: DUG (Short oil ETF), TSO, Hero Honda, Natl. Alum
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