Summary:
More fireworks today resulting in a 1.4% gain. Biggest movers were: XSI up 13.5%, BULK up 12%, AUY up 5%, and TNH down 7.7%. No news on XSI. I read that BULK was apparently upgraded by Cantor Fitzgerald but couldn’t confirm. TNH was up 7% before crashing. I don’t like this sort of reversal in a stock that has had a big run-up. I associate it with the high probability of at least a local top. I have related how NFI reversed intraday at its top in March 2004. I will admit that I have no statistical evidence for a pattern. Nonetheless I reduced my TNH position by half, unfortunately near the low.
I would have had even more volatility had I not closed ACY and NFI yesterday. They were down 20% and 42% respectively. I was kicking myself in the morning when ACY was up by 10%, but felt pretty smart by the close. I’d like to buy this again if it gets cheap enough, but right now its a plaything of the market gods. Though I took a hit on NFI, I saved money and mental angst by getting out when the obvious was obvious. If it survives, NFI may be a buy at some point, but not before the mortgage market turns or the price goes REALLY low.
It was also a good day for miners with gold reserves. In addition to AUY, both NTO and NXG gained more than 3%. The price of gold is at a 9-month high. SLW was also up more than 3%. Yesterday it reported 4Q EPS of $0.11.
Positions:
Long: JEQ JSC LMC AUY SLW NTO NXG HBMFF ALSWF JAGNF FFHL EGLE AOB XSI TDF KF UAHC FF NTLRF TNH LMGGF BULK
Short: JCG BKC
Cash: 3.3%
Trades: sold 50% of TNH@47.53
Read: BOJ raised rates to 0.5%
Stocks Researched:
Hours spent on market: 0.5
Positions most worried about:
Positions most sanguine about: everything
Biggest market worries: Volatility could be signaling downturn in some of my go-go position.
Thinking about: trimming around the edges?
Outlook ( up-flat-down surety rating: 1-5 reasoning):
US: up 1.0 ??
Tech: ??
Japan: up 2.5
China: up 3.0 economic growth, Economist article 2/8/07
Silver: up 2.5, industrial, china demand
Gold: up 2.5, dollar weakness, china demand, price action
Copper: ??
Zinc: up 3, low LME warehouse stocks
Real life: somewhat productive, getting a little worried about some deadlines
Previous night sleep and exercise: 7 hrs, soccer Friday
Mood: a little anxious. Studies? Market volatility?
