Thursday, June 07, 2007

The tide has turned

The question, I think, is been answered - equities market entered correction.
Yesterday's selloff was broad based, but volume was lacking, it was not low - just was not impressive, but still - it has got me worried.
Plus, unusually high for one day number of my longer term positions hit trailing sell orders ( in the range in between 5 and 10% - depending on corresponding stock's "true" daily range/volatility.)
Today's selloff added volume, big volume, no panic yet, a lot of methodical selling.
Then I looked at how bond market is acting - and started to sell remaining long positions at a market. By 3PM I was 80% cash and I will liquidate remaining holdings tomorrow morning into the pop.
I am not short yet, mostly due to not seen really nice sustainable short setups, but for next few days/weeks I will mostly be only day trading or just staying away from the market somewhere on exotic island ( or just my own backyard :)

Good luck and ... save your chips for the next big game