Straight Up: Yesterday's Disappointing Market Turnaround
Tim Knight | Jun 17, 2020 04:14AM ET
It has become quite evident that anyone who dares short this market needs to adopt a “smash and grab” attitude and simply cover whatever positions they have during those rare instances (like last Thursday) when the Fed briefly loses control. The fact we’ve soared about 2,200 Dow points in 36 hours based on absolutely nothing proves that.
Chatter (once again) about a trillion-dollar infrastructure bill is pushing equities higher and smashing bonds, since a nation addicted to endless trillion-dollar programs is looking like an increasingly worrisome credit risk. The bond futures have fallen hard over the past 36 hours:
Thus, virtually the entire rout from last Thursday has been laid waste. The small caps have just about returned to their neckline.
During yesterday’s disappointing turnaround, I had trimmed my positions from 75 to 40 and likewise trimmed my exposure from 150% to 80%. I am thus entering the day relatively light and, frankly, feeling an awful lot like Sisyphus.
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