This Week in Retrospect, Next Week's Strategy.

Man what a strange week. I've made some good calls and some bad. I bought Ford Motor Company (Public, NYSE:F) all the way down into earnings, and I feel pretty good about that. However, I got scared when I saw that growth slope and sold WAY to early. On the other hand, I sold Nordstrom, Inc. (Public, NYSE:JWN) almost perfectly at it's peak, and I've been shorting down since then. I started out very bullish on Puda Coal, Inc (Public, AMEX:PUDA), and I am just getting BURNED by that buy. Of course to make matters worse, they come out with an earnings statement that basically shows all good news except this quarter's EPS. Saying things like "Puda Coal received final approval from the Shanxi provincial government to consolidate 8 coal mines in Pinglu County." And I hear about China's increasing demand for steel and therefore coking coal. And even still, the price goes down. I like to think I can keep my emotions at bay, but PUDA still feels like a very strong buy. Worse, I DROOL when I see pullbacks, and it just makes doubling down on the stock that much more tantalizing.
Sometimes I just don't understand Wall St. But, as a technical trader, what I do know is this: We are in a crucial time for the market. The S&P is hitting MAJOR resistance at 1100, and at the same time, we're hearing all this talk about various funds having to pour money into stocks because they've missed the move so far.
Now I consider myself a bull, but these secondary market fluctuations are based so much on psychology. I think the market is getting ahead of itself, and if I think that, imagine how bears view the market. I'm going to have to stick to my charts. I'm maintaining my S&P prediction of 1115. But after that, I expect it to drop over the course of a couple months to around 1000. I've illustrated this pattern of testing macro resistance, correcting downward, and blasting through resistance in my previous posts. Take a look if you're a visual kind of person :). Therefore, I'm playing mostly conservatively for the next month or so. When the S&P reaches my target, or when it starts to show signs of a reversal, I am shorting the market using ProShares Short S&P500 (ETF) (Public, NYSE:SH). Still going to hold on to my long term positions that were left over from panic recession mode, PepsiCo, Inc. (Public, NYSE:PEP), and SPDR Gold Trust (ETF) (Public, NYSE:GLD) being the largest. And mark my words I AM DOUBLING DOWN ON PUDA COAL. This is a company I really believe in. I think it has AMAZING growth potential. I still don't know if it will pan out, but I am confident enough to sleep at night. The risk is limited because of the low price of the stock and the fact that it's a Chinese company that mainly sells domestically to Chinese buyers. I think it's going to post monster numbers after it finishes consolidating the 8 coal mines.
Good Luck,
-Samba