All Hail the Queen: Postmarket Update 9/24/09

I had a busy day, so I’ll try and keep it short and to the point tonight.

I sold short the British Pound via FXB as the market opened this morning.  I have been drooling over this trade for quite some time now, you are probably getting sick of hearing about it.  Not only do I like the relative weakness to other US Dollar crosses, but I love it as a hedge against my gold position and other equity exposure.  The short dollar trade is still crowded here, that doesn’t mean it’s the wrong trade, it just needs to be a little unwound over the next few days.  I think the dollar as a whole can keep falling and still show me a profit on my GBP short.

I cut lose Live Nation this morning as I didn’t want the large profit there to slip away.  You can check the specifics of the trade in the closed trades section of my trading book.  LYV was extended and was ripe for a pullback.  I also see a lot of overhead resistance up around 9.50, limiting further upside once its consolidation is complete.  I think you could see $7.30 in that name before the run resumes.

I replaced that long with Skyworks Solutions after hours as it was taken down with Research In Motion getting buried.  I missed this entry on 9/8 as my long book was full and I’ll be glad to take it very close to the breakout price with reduced risk.  SWKS has been one of the best performers in the mobile internet space since March.  I like the chart, I like the company, and I like the fact that it has broken out of a range it has traded in since 2002.

Unless you live under a rock, as I mentioned before, RIMM got destroyed after hours today.  I see support at 72$ which is the 200 day exponential moving average, and that is where my advice on RIMM ends.  I will say this though, at least here is a company that is GROWING the top line.  How many companies out there can say that!  Revenues rose 36.8% year over year!  Yes, they need to show great growth to justify their P/E, but hey, who is arguing with that number?  This all happening while shit stocks all over the place rally to heaven when their top lines are shrinking and analysts who can’t look past their next bonus upgrade them because of fucking cost cutting which flows to the bottom line.  Look, I’ve got no position here, I even got rid of my Blackberry for an iPhone (fuck AT&T), I’m just trying to make a little sense out of this mess that we still call a market.

About that market, we came down towards the 20 day moving average which also represents a larger level of support going back to the end of August.  Could we continue downward towards the 50 day around 102, sure.  I have the feeling that the action is going to get pretty sloppy over the next week or two as the market digests a little bounce in the US Dollar and forms a new base off of which to attack 110 on the SPY.

Things which are putting bearish thoughts in my mind include the recent action in Copper which looks to be putting in a rounding top formation and the action in Crude Oil which although trading in no man’s land right now, looks bearish.  I’ll continue to be bullish on the larger equity market though until given a sell signal, which right now sits at 99.50 on the SPY.

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