Be Careful What You Wish For

I think the coming correction will be contained unless we see heavy stock issuance. The mother of all offerings would be the government selling their Citigroup stake. If I were a bull I would be praying for the stock to go down so that the government does not want to sell. The further above $4 the stock goes, the more likely the government will be to sell.

While I could see the market rejoicing when the offering is announced I don't believe there will be much rejoicing once the shares are issued and the market is choking on it.

6 comments:

Anonymous said...

Again, I think todays early action was a VERY anticipated move lower. Everybody was/is expecting some kind of a pullback on the run up we've had.
Everyone had already planned on buying it. We could go higher before we dip.

Tsachy Mishal said...

The heavy call buying on the ISE today tells me that we are still topping out and this is not the beginning of a new leg up. It is rare that the first dip is not bought. Tops are processes while bottoms are events.

Anonymous said...

15pts from new 52 week high. Less than 200 from 11000

momentum

Anonymous said...

Would you buy health care stocks here?

Tsachy Mishal said...

Im long them out the wazoo but Im not buying here.

Tsachy Mishal said...

If I were putting new money to work in healthcare Pfizer would be the place.

I am short a boatload of the April 17 puts.