We had a decent day in the portfolio with all stocks gaining but several only posted minor gains. We have ten positions and the biggest gain was 77 cents despite a good day on the Russell 2000. That is telling me that the big cap short covering powered the markets higher and the low volatility, low beta stocks were left behind.
That may or may not continue on Wednesday but we need to see where the market is going before we add any new positions. The odds of some profit taking after a monster short squeeze rally are very good. I am sure there are shorts that did not cover and are sitting dumbfounded while staring at their charts tonight. That suggests we could have another spike at the open that runs into heavy selling.
I would rather not add another long only to get filled at the high of the day. Since I also believe market sentiment has changed for the positive I do not want to add a bearish play until the post spike volatility has faded.
We need to take a deep breath and just watch the markets on Wednesday. There are a lot of macro and geopolitical forces in play and the traffic could be heavy. It is better to wait for a "fat pitch day" than swinging blindly at every pitch that is thrown.
NEW BULLISH Plays
No New Bullish Plays
NEW BEARISH Plays
No New Bearish Plays