Thursday, August 9, 2012

Risk Management and Confirming the Bias

Risk management would dictate lightening some positions into the rally, but the greed inside me thinks this rally has as few more weeks of strong swings - last night's session failed to see any real sell-off and finally we are seeing some performance picking up in the cyclical names (although copper prices haven't picked up strong yet).  I have a feeling that the bulls are now pressing their bets on the beta names to continue another leg in the rally.

I am looking at the sentiment and closely for any potential dis-confirming evidence that the momentum is running out.  There's plenty of momentum for now.

How the yields are out of sync with equity valuations and where potentially the market is headed 

BCA concludes we need more confirmation, looking at the BCA global leading indicator.