The Witch's Brew

Predicting the stock market is impossible nevertheless that is what we try to do. The attempt to predict is based upon an unending flow of misinformation pouring from the minions of Wall Street. This forms the basis of our investment decisions. This is why retail investors are sheared. And its just not the retail investors that get sheared. It’s larger investors including the hedge fund boys that are not part of the “Boyz club” that try to cross the most powerful economic juggernaut in the world. So don’t feel too insignificant. Even though you are. Look at it a different way. Just try and maintain knat size significance and maybe they won’t crush you. That is an advantage in this game. In other words stay away from the crowd. Eventually that becomes the target. We’ve been running with the crowd to some degree because that IS the direction the market wants to take us all. Longer term that is still their game but we are getting closer to the end game so an element of risk is increasing as you stay in the game. Predicting the day to day and week to week movements is absurd. But you do have some ability to predict areas of increased risk.

Right now we are increased intermediate term risk. There is a need to remove frothe from commodity prices and the market. There is a need to drag more mom and pop investors into the stock market and that means we need some correction. Corrections need some time and the stochastics MACDs and RSIs say we need a couple of weeks so hold ing a good chunk of cash is prudent. You maybe addicted to this casino but patience is a virtue right now. Nibbling and trading some of the miners here can be productive but your fingers might get burned and you may be an investor for longer than a month if you pick them up at these prices. But on hard beatdowns you can make some great intraday day trades.

EUO is getting cheaper and cheaper don’t overlook that one. Its a longer term hold. When the Euro spreads pop this one is going to be a nice one to just sit in your portfolio. Those PIIGS are getting very warm right now. Summer should really pull them out onto the streets as austerity is demanded by the bankers and the debt slaves try to rebel. It will make great headlines on CNBS. I still have my PHYS and a little PSLV to trade. I also like our biotech plays. ANIK is brewing.

Read more at Great Depression 2