JANUARY 3rd: PORTFOLIO POSITIONING
During the trading day today I tweeted the following:
SCO (short crude oil) is now the largest position in the portfolio. I continue to hold FAZ and TZA medium sized positions. As far as overall short exposure goes, I am getting up there.
There is nothing that I like more than shorting a commodity that is seeing headline targets putting it in the $140 to $200 range should war break out due to the same posturing that has been occurring for decades. I speak, of course, of the Iranian threat that is being blamed for the spike in oil recently.
This has a way of clearing out short sellers and bringing in both casual longs and those wishing to profit from perceived technical breakouts (you know, those patterns that made money a decade ago) due to the momentum created from the anticipation of such an event. The tension usually just fizzles away after some weeks. I expect this to be much the same. There is simply too much at stake during such a fragile time in the world economy to start a war with Iran. All parties are keen to this fact.
From a technical basis it is moving up against enormous resistance here currently, which is why I added to the position today. I'll go over that in more detail in the coming days.
