With Hurricane Rita coming towards the Gulf of Mexico everyone wants to talk about Oil Oil Oil again. I will not be buying oil stocks up here. I think that Oil is the single riskiest place to be in the market. Even if the price of oil stocks continue to rally, you can get just as good a return with lower riks in other areas. We continue to have a market unlike any I have ever seen before in that we have a very robust bull market occuring right along side a very brutal bear. Something will eventually have to give, but I am not smart enough to know which one it is yet. In the mean time I continue to play both sides. Anything related to consumer discretionary spending is getting hit hard. Groups that fall into this category would include Resturants and Retailers. Additionally I would add anything interest rate related at this point as the yield curve continues to flatten out and will probably invert. Regional Banks, Homebuilders, Lenders etc are all very vulnerable and worth having short positons in. On the long side tech continues to act well, led by biotech and semiconductors. One well known tech stock that I really like at this point in ADBE on the monthly chart. I feel that this stock has several months of upside ahead of it. Additional groups showing strength include Aerospace, Mobile Homes and Aerospace. Brandon PS, I will be out of town starting tomorrow and will return on Saturday. I will be at my grandmothers place in NW Iowa (the boonies) and will not have Internet during this time.
I appreciate your commentary. At what level would you consider the market to be entering a bearish status?