Media Always has it right..
We hear this morning that the S&P is now in a Bear market. How ridiculous is that pronouncement. The only way it would have significance is if journalists would have have been smart enough to have pointed out on January 4, 2022 that a Bear market was starting or on March 6, 2009 that a Bull market was starting. So let’s set all that talk aside.
Here are some things that I am thinking about today.
- The first phase of the Bear market on the S&P saw it drop 12.4 % from January 4, 2022 to January 24, 2022, 20 calendar days.
- The second phase of the Bear Market on the S&P saw it drop 11.6 % from June 2, 2022 to June 13, 2022, 11 calendar days.
- I caught the first phase on the short side, I missed the second phase on the short side.
- What I did in the in-between period, January 24th 2022 to June 2, 2022, was two things; a) trade the swings with speculative 3X leverage ETF’s SPXL and TQQQ, and b) build a long position in 70 % of my portfolio in the EV and semi-conductor sector, the sector that I believe will have the largest potential due to climate change factors coming out of this bubble.
- The positions that we placed on May 11-12 in this EV and semi-conductor space were priced between 70 and 72 percent from the highs. I am not smart enough to know how low is low, but 70 % down is close enough for me.
- Over the next three days I anticipate placing positions in the speculative 30 % of the portfolio using the 3X ETF’s SPXL and TQQQ. Again, I don’t know where the bottom is, but I do know the FED has not corrected what caused the bubble.
- And lastly, I don’t believe that inflation is going away, but I do believe people will eventually learn to live with a certain amount of it. And again. 3.5 % interest rates are not high rates.
- And one more thing, the XLE/SMH chart is maybe a more visual relationship than a trading relationship. Most of my conceptual position is on the long side of the trade, represented by SMH, However, I do have a small short position in SCO, the leverage short oil ETF.