NFTRH; More Thoughts on the Bull Case

It is a mixed messages market.  With all the bearish indicators, we have had some fairly severe downside in several momentum related indexes.  This begs the question ‘was that it?’ with regard to ‘the correction’?

Reference NFTRH 291’s Macro Pivot Makes Progress, in which the bear orientation was reviewed, seen as still intact but not yet engaged.  A sort of Hussman vs. Grantham thing if you will.  Also reference more doubt (for the bear case) that this line of thought inspired in a post yesterday:  Giving Bears Pause.

I intend to stick with a balanced approach in holding a couple items short (currently the Semiconductors and the Financials) against some quality positions that have been beat down recently (currently GOOG, DEPO and Semiconductor company, LSCC) along with giving a try on the China/Asia and Emerging Market themes we have been following (via TDF and EMF).

This market is going to break for the bulls or the bears soon.  BKX-SPX has broken down and Treasury bonds have been out performing.  That is reflected in damage to much of the market.  While I am by no means removing the ‘macro pivot’ plan for 2014, I am inching closer toward being ready for a summer rally off of the recent corrections in several sectors of the market, and watching some more individual items for possible addition.

Just an FYI update.  The SOX will continue to guide (and we will continue to follow its instructions, currently a holding pattern) as will the NDX if it gets above and holds above the resistance line we have been noting.  In other words, don’t fight the market, whether you are a bull or a bear.

Over in precious metals land, I continue to leave it alone (other than actual metal holdings) until we get something firm in the technicals.  Still watching June/July there for what could be an important bottom.