2014 is going to be an interesting year, and next week will tell us a lot. Many traders, including myself are looking at 2014 as the year of the commodity. Liquidity is still pouring in, bond market is starting to leak higher, stocks are fully valued, to say the least, emerging markets are getting nervous, so where does the money flow?
Sounds easy, but then oil drops 6% in one week, so are we facing something more deflationary? Maybe both, so I am cautious coming out of the gate.
As I mentioned last week, I am going towards a more portfolio long short approach and how I am positioned as of Friday is slightly short broad market, short Technology, slightly long energy, and slightly long metals and miners. Not showing is I shorted volatility through UVXY and shorted NUGT with puts. Small and short term trades. I am also expecting a pullback in metals next, and will double my QID position if tech weakness prevails.
Reading my graph, on the right side you will see a column that says buy/sell. Green, yellow, red is based on what my signals say, even if I choose not to buy it, you can see the signal. I am publishing every evening for subscribers and weekly here. The other column shows if I have a full, partial or no position. My size reflects me personally, but others have different size portfolios, so they can gauge my commitment and act accordingly. I also color code my long short categories.
If you do follow these trades, I highly suggest you pay attention to my hedges. I may not get totally out of a position, just amp my hedge. My goal is to trade less, with less volatility, by being in the right stocks from a macro perspective, adjusting size and hedges in order to outperform the market.