Replies to post #330 on Contrarian Value Ideas

[gfp927z]

Derf, >> get it and move on <<

With a short term trade as the strategy, the question is how long the current bounce will last. If it closes today near the high of the day, then the current bounce might continue and get to 60-62 before a pullback (a guess). But if it leaves a bearish candlestick today, then a pullback to the 50 MA level occurs first, and then re-evaluate for another bounce. So have to play it by ear. But I'm not an experienced short term trader, so would just be winging it.

That said, if it moves up sharply in the near term, I might be tempted to book the short term profit and then try to reload after a pullback. That's what happened with SMCI -- got lucky and now have the luxury of the 1/2 free shares to hold longer term. The initial strategy wasn't for a short term trade, it only turned out that way for 1/2 of the position. It would sure be great if things always worked out that way. Btw, thanks again for your 1000 call, it was spot on and signaled the near term top and subsequent 30% retracement.




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[gfp927z]

Derf, ADM left a somewhat ambiguous candlestick today. It stayed above the 50 MA, so that's good, but looks like some heavy profit taking volume in the last hour. So might go either way tomorrow, probably a modest pause / pullback (a guess), but then more upside next week? Just guessing though. I'm not an experienced trader, but did spend a year subscribed to Stockcharts.com for their online 'chart school' (Art Hill), and had a good aptitude for it, but mainly just learned the basics and never really tried it much for active trading.

With the Fed meeting next Tues + Wed, I figure the market could be somewhat subdued until that's over. I used to call Powell 'Grumpy Jerome', but after the Fed's dovish pivot last Fall he has mellowed considerably. But if he senses the stock market getting overly buoyant, he might go back toward the grumpy side, at least verbally.

But based on Nick Timiraos' articles (link below), the Fed clearly plans to start easing, the only question being when. June is most likely, but subject to the ongoing data. Timiraos is well known on Wall Street as the designated Fed mouthpiece, who is tasked with leaking Fed policy guidance to Wall Street so there are fewer surprises. The guidance is contained in his headlines, so it isn't really necessary to subscribe to WSJ for the full articles -

Nick Timiraos - Chief Economics Correspondent at the Wall Street Journal -

https://www.wsj.com/news/author/nick-timiraos



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[gfp927z]

Derf, With the recent inflation numbers coming in higher than expected, and analysts pushing back their Fed % pivot date from June to July or later, the interest rate sensitive sectors in particular have sold off significantly today. Oh well, so much for my 'buy small caps, REITS, utilities' strategy lol. But the CPI and PPI numbers are just for one month, so we'll see how things look in the months ahead.

Anyway, while liftoff for the % sensitive sectors might be delayed, these still seem like logical areas to be in for the next several years as % rates gradually trend lower. But the techs and growth sectors should also do well in that environment, so one solution ---> own the S+P 500 and get all sectors :o)

Btw, I see ADM is still above the 50 MA. It didn't quite reach 60 intraday, but pretty close. My solar plays ENPH, FSLR are looking weak, as these are particularly sensitive to % rates, so looks like the recovery will be delayed. I only own a few shares though.

Just curious if you are still in SMG? The chart setup does look interesting, though I figure the cannabis landscape may have to improve to really get a recovery going. Here's some info on SMG's Hawthorne unit (next post), and looks like they are working on it to become a separate company.



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