Closing Observations

  • Does anyone really think that this mess we are in will get better just because John Mccain gets elected?
  • Isn't Bush a Republican too?
  • Yesterday, stocks widely owned by hedge funds did well for the first time in ages. Today, the outperformance continues with Mastercard up over 5%. Energy and material stocks are up as well.
  • Even more impressive is that energy stocks are up despite oil being down sharply.
  • Does a rally to relieve the oversold condition in hedge fund owned names need to play out before the market can reverse lower?
  • It looks like the game of Jenga we call the stock market is still on.
  • It looks like I still might get my chance to short this market. Have a good night.


CP said...

From the WSJ: "Short-selling levels at the New York Stock Exchange and the Nasdaq Stock Market continued their decline in the latter half of August, marking the third straight period during which positions have fallen."

Seems like quite a bit of covering went on since the Jul 15 low?

CP said...

Another thought: shorts seem pretty fearful.

Witness the 20 point S&P rally at the end of the day.

Tsachy Mishal said...

hedge funds are reducing gross exposure. that means reducing longs as well as shorts. i am not sure you can read into the short numbers too deeply.