Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

That Perpetual State of Disappointment

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This is one of those "got to get this off my chest" type posts.

I cannot help but feel very disappointed in today's action. It's not so much that the market isn't doing what I'd like it to do – – that's something none of us can ever control – – it's the fact that the way this market is behaving is rewarding rule-breaking and punishing rule-following.

One of the most basic rules is to let profits run. You don't close out positions the same day you open them just because you happen to have a small profit. You let them run, updating the stops along the way, and hope that they will blossom into big winners.

Well, that's what I try to do, and it's not working. What we're going through today is a perfect example of this. Yesterday the market fell nicely, and I had a handsomely-profitable day. Now that the Summit is done, it seemed that things were in line for a continuation of a soft market. Irrespective of one's views of what the market was going to do today, the fact is that there was no logical reason to scurry around just before the close and shut down all my positions just to take profits.

But that is precisely what I wish I would have done, simply because the market is rocketing higher today. It seems that we're on an endless cycle of up/down/up/down/up/down/up, and it's enough to break one's spirit. After all, if we can't manage to hold on to gains for more than a day, what's the point of any of this?

I took some profits on some of my riskier positions earlier today, and I've bought a big block of DIA (and shorted a medium-sized TLT) to help balance things out. But this market is exhausting, I've got to tell you, and as much as I'd love to pretend to wallow around in the joy of trading every single day, I'm frankly getting awfully tired of this. I imagine some of you are, too, and I wanted you to know you're not alone.

Eighteen Hundred Points

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Well, the Dow has rallied about 1800 points in the past couple of months, since the October 4th low. Nothing's really changed since then – – the U.S. is still, by any realistic measure, bankrupt, and the systemic issues of the Euro crisis are probably worse than ever.The "super-committee" to address U.S. debt did a joke of a job, even to a cynic like me, since they gave up pretty much instantly. Sentiment, however, has changed mightily, and we have another big rally on our hands today.

I still focus on cash as my only acceptable "long" position, in spite of potential opportunity costs. My disposition remains to move my short-position-percentage up or down, depending on the circumstances. I remain in "risk off" mode, at about 30% short, 70% cash.

One item I've pointed out, tongue-in-cheek, as an interesting reversal indicator is ERY, but today puts a bullet through that fellow's forehead. It was cute while it lasted, but this – like DUG – is getting trampled to lifetime lows.

1205-ery

How’s My Day?

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Not so great!

That shouldn't come as a huge surprise, since I was short. The good news is that the very thing that I've been griping about so much – – – my refusal to overly-expose myself in this market – – – is what is saving me today. I came into the day 70% in cash (the rest in small shorts), thus I am down 1.38% as of this writing, in the face of a Dow that has been up almost 500 points.

So, as bad days goes, this one is quite survivable.

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My Beef with The Grind

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On Tuesday evening, I was bemoaning to myself how lamely the month had been going. After six trading days, I was sitting on a loss, and I was really frustrated. I thought to myself, "Well, one really good day would fix that." And then I paused a few moments and thought again, "Yeah, like a day THAT good is going to happen."

And then Wednesday happened, and, voila, it turned the entire month around.

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Sweet Jesus on a Pita Bread

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Here we go again. Here we go again. 

This market is hell-bound determined to drive every single one of us nuts.

It was 4 in the morning, and I woke up worrying, as I always do, about what's next. My post yesterday, rightly titled "Beaten" and tagged with a "Defeat" category, grudgingly admitted that I had held back my impulse to wretch violently and had bought some stocks for safety's sake. (I am still net short, as I always am, but not aggressively so).

So, naturally, this story from ZH tells us the news: Italian bond yields are exploding higher, and the world's markets….which until, oh, not that many hours ago didn't seem to break on any news, no matter how bad…..are suddenly in a free fall.

I have 75 short positions, so I'm not that miserable, but I already hate every single one of my 16 longs, and I hate even more the fact that I have no large short ETF positions.

And just you watch. Something completely retarded will happen – – Herman Cain will announce a new Pay-Per-View Porn channel or something – – and everything you are seeing right now will be completely erased.

Bitter much, Tim?