Bullitt

Ahh, yes, the songs of the summer; not only is love like a baseball game, but so goes investing.

Tapped out to the G Fund yesterday and while we probably will get a little rally next week, I'm not going to worry about it. The failure of the market to rally in the midst of some serious up volume and breadth thrust goes to show how broken it is. Right now there is some major resistance ahead to include those who bought at the start of 2010 and the Feb lows. I should have listened to myself and re-read my posts from the past six months as a reminder. Playing the market for a 'bounce' when the trend has turned bearish is a fools game. I'm not too crazy about being 100% in any direction, but like I said, maybe we'll get 'em back cheaper in the 900's. Not cutting losses is how "buy and hope's" are born. Most never thought it could happen to them.

Sold out RSX at the breakeven point even though it is exhibiting some RS compared to the general market. The reason I sold RSX is because the oil sector has turned bearish along with materials. I believe precious metals will roll over here too, especially the mining stocks which would not fare well for RSX.

I figure I might be able to get 'em cheaper around 900-950, but I am in no hurry to get excited here. It's pretty clear that this market has hit the 'Hope' phase in the sentiment cycle. Bullish analysts continue to change targets and support/buy points as the bearish tide rips. Perfect example are the ones who claim that the 50/200 cross doesn't mean anything.

It's all risk management these days and you'll probably never see me go 100% into stocks at one time on a trade. Not only is it reckless if it goes against you, but very high risk as no person or no system can predict the future. Systems can assign probabilities, but that's about it. Anybody know what the probability of the flash crash was? How about the '08 housing crash? Too often we make decisions based (most of the time) off charts and sentiment, and when they go against us it's the PPT or manipulation or anything else but our fault that the market is doing what it is doing. When you go down looking, it's best to head back to the dugout and remember that there will be many chances and at bats to come.

We'll see if sentiment or any other indicators show signs of panic in the coming weeks which may be a chance for another at bat with runners in scoring position, but that doesn't mean to swing at the first pitch in the strike zone; it could be a fork ball.