Dowbama

I was able to watch most of the inauguration while at work yesterday. I would have felt guilty if I did not. It was very moving and amazing to me to see so many people - black and white, conservative and liberal - so excited about Obama becoming our president. I watch CNBC regularly - to put it mild, and it is great to see so many conservative regulars say they like what Obama is doing and what he has proposed. I won't say anything else, but it is such a relief to me knowing that we have a fresh face in the White house and a new change in strategic direction for the country.

Tuesday's sell off in the markets was a combination of sell the news, nervousness about Geithner being not being confirmed Treasury Secretary, and follow through from the Asian and US markets the days prior. It is tough to budge out of a trend and we were certainly in a downward trend for the last several days. Breaking through some support provided even more reason to sell for you technical indicator peeps out there. But, we were oversold and today after listening to the Geithner hearing and opinions on CNBC, it was clear that he was going to make it in and Obama could get to work fixing this sluggish, if not depressed, economy.

I buy equities (stocks) when I hear things like, "it is going to get much worse" or "no reason for stocks to go up". Even me who was hesitant to buy more yesterday toward the close was a bit spooked by the possibility that we would test those Nov. lows again. I should have bought more despite my fears - I should have known better. I was however fortunate to have bought on the way down from the early January highs and only need a couple percentage point gain in the S&P to reach the level I was at when the Dow was around 9000. I strongly feel that in order to succeed in the market you must remain active and vigilant. I'll get into why 401K investing is destined to under perform a little later...but remaining active and observant, and "feeling" the market sentiment has so far proven a very successful strategy for me.

I was just looking at my realized gains for the year and I was actually positive despite the Dow & S&P being down around 6%. I shorted the market some on the way down with some triple or double short EFT's (BGZ for one - triple short large cap) and bought a bit of Platinum using the PTM ETF for a quick 6% bounce. While I didn't kill the market, I knew any positive return was a big plus for me - no pun intended.

So where do we go...probably up I guess, or down. Basically, I don't expect to be far from where we are a couple weeks from now. I still believe we might head lower before we head higher. We have not had a recent flush out that we need to move us much higher. So, I'm going to sit on what I have and take 20% or 30% off if we go up some. That way I can regain my recent unrealized losses and be positive for the year again. If Thursday we get a 1 or 2% rally, I'll sell my UYG's (1000 shares of the double long financials I picked up yesterday at $3.25 (closed at $3.37 today)).

Oh yea...keep an eye out for oil...it is back up above $40, but I believe only because of a bounce and some colder temps. We'll need an economic turnaround signal before we push back up over $50 again.