Birchtree's Account Talk

What the heck - a drop from Dow +133 to -12 in a matter of a minute - not another fat finger trade. Interesting times....for sure, keep'em scared.
 
Wrong, it was more than 100.:)
April 1999 was the first and only month for the DJIA to post a gain of 1000 points - May 2013 will be the second month to post a 1000 point gain. Don't I wish. Knowledge has marked the difference between those that take informed risks and make money and those that remain petrified by fear in a perpetual state of inaction. It sometimes pays to be patient and dedicated to a long-term, disciplined investment strategy. I'm staying with the I fund because Europe will play catch up.
 
I generally don't like to look backwards but sometimes I'll take a glimpse. On 4/15 I sold my position in RKT to help pay my taxes at $86.70 and now it's trading at $101 and change - that's a reality. I think I'm going to make a few purchases this morning to soothe the pain.
 
Money days like today remind me that I'm getting closer to continuing to follow my strategy of pyramiding up my long exposure as profits increase. Margin get ready.
 
Thank you to all the "Chicken Littles...the sky is falling" folks.

Your negativity & fear is not nearly enough to induce any meaningful selloff...but your negativity and fear is "just right" to keep Sentiment from getting overly bullish. which only keeps the uptrend going higher, with even the biggest dips stopping dead in their tracks at the 50 day EMA (aka The Bernanke QE4 Floor)...before quickly resuming their track to higher highs.

Damn...I sound so much like Birchtree these days, I thought I would post this on his site....hope you're OK with that Birch.:)
As his spokesperson, ha, I think Birch would find your comment favorable. I also think the SPX is going to go up 5 to 10 points tomorrow. The C fund is owed after today's performance, considering the S and I doing so well. SPX 1600 within a week, then it continues its climb.
 
As of today I believe market breadth continues to remain bullish as the cumulative advance-decline for the S&P 500 and the NYSE have now breached their January 2013 highs. The bullish case for equities can best be summarized by some of the price action that I'm seeing especially in the retail, home building, financial and energy sectors. Leadership provided by these sectors would be the right kind of leadership for a continuation of this broad market rally.
 
It's possible that my oceanic account may actually post a positive April witrh only four trading days left. Bull markets do not die of old age. Instead they are assassinated - usually by central banks. So how many rate bullets does it take to fell a bull. You may not be surprised to hear that there is no precise answer, because it depends mainly on sentiment and liquidity. I suspect we could see a 5% Fed funds rate before there is any real trouble - the market will rise as rates increase because of economic strength and positive growth in earnings. So where is the wall - wait and find out. Staying long for several more years.
 
Where is that correction - it ain't coming except for an off day here and there. When a market doesn't do what it should do when it should do it then it may be about to do the exact opposite in a big way. I can feel that rumble again as the herd approaches to push the Dow above 15,000 and beyond. The key in terms of longer term health is for the indexes, the major indexes, to hold on to there 50 day exponential moving averages on a hold. A small breach isn't a problem but a close below with force would signal there's trouble. No trouble in sight. Geewiss - what is that smell wafting the board today. It's the sweet smell of superlative bull manure.
 
The three wise men truths: stocks are still hated - how great is that, the stock market is in a multi-year mega trend, and corrections are for accumulating. Anyone that wants out - be my guest.
 
Dividends are a long term investor's best friend. So if we are indeed in a new secular bull market, stock portfolios are likely to produce spectacular inflation-adjusted returns over the following decades - the Birchtree 300 will live on even after I'm no longer able.
 
I've been fortunate enough to make gains all week erasing my loss from last week - only one more day to go. Most head and shoulder patterns turn out to be false alarms. Drip feed your money into the market. No one knows exactly where markets are going so drip feed your money into the market by making regular investments. That way you will average out the ups and downs of the market - that's a benefit of dividend reinvestments.
 
Best to ignore the Q1 GDP of 2.5% as it will be revised upward. Most market participants are so finely tuned into mainstream news that they are easily swayed by the negativity and emotionalism of the leading stories of the day.
 
Jeremy Grantham has said: "U.S. stocks look to be one of the better asset classes in the world today, particularly blue chip issues that have lagged small and mid size stocks for the last 14 years. High-quality U.S. stocks probably will be one of the best asset classes in the world in the next seven years." Over the past 140 years, the return from American stocks has almost mirrored the growth in corporate earnings. The future is bright going forward.
 
I need to put out a call to the hoofers and get this market rolling. It is normal and expected for markets to test down to their 50 day exponential moving averages from time to time. That allows for the oscillators to unwind and for any negative divergences that formed to be wiped out. Usually, the number of stocks making new highs begins to deteriorate four to six months before indexes fall. You should know that a straight up market is hard to trade. JTH has shown us the angle of the SPX ascent is impressive - I wouldn't fight that momentum. I think if I can see SPX 1600 next week I'll show off my very best Birchtree Booty Shake. Stay tuned.
 
"The amount of money that's playing defensive is astronomical, says Robert Lutts. Main Stree isn't yet in Wall Street. It is still scared to death. In the past couple of years, the professional money started to flow in. This is just the beginning of new flows that will push indexes even higher." The fear of being left behind will increase greatly for professional money managers should the rally remain intact through the summer. Rallies during the early summer months of May, June, and July have historically shown the smallest potential gains for all 12 months of the year - except for this year, I'm in the Clester camp for a continuing bull run right on through the summer.
 
I'm still patiently waiting for my margin accessability to open up. I got up this morning thinking all I had to do today was make +$31K and I'd have a +$200K week. That would translate into buying power of +$400K - that's a lot of manure to spread around in the Birchtree 300 garden. Now I'm not sure if I'll break even on the day - so perhaps May will be the month that leads me to liberation. Leveraging up my profits is the way to get more buying power without selling stocks and accumulating taxes. I'll gladly chase momentum and follow Ferdinand into the sweet smelling clover. Yes, patience is a virtue but how much longer must I wait. I'm getting worn out sitting on the sidelines when I could be making serious dollars that go to work immediately.
 
The SPX just touched positive territory before the end of the day. That's after most of the day negative. It'll be nice to get a Monday bounce and I think next week will bring 1600. When that happens, I'll be singing and dancing. This grind only proves that winners never quit. It has been quite an effort staying with my gut feeling to go 75% I fund this month. It has proven lucrative.
 
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