Go Bears!

 | Mar 16, 2012 | 4:33 PM EDT  | Comments
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Despite the howls of top-calling bears, the market just wouldn't quit this week. We had a few brief flurries of selling, but the dip-buyers were on them like a dog on a bone and there was little red to be found in the indices all week.

The intense focus on Apple (AAPL), which is clearly the greatest stock in the history of the world, increased even more this week, and strength there and a few other big-caps helped hide relative underperformance in small-caps. Nothing much other than the precious metals stocks stayed down for long.

My main theme this week has been to try to ignore the top-callers, who are becoming louder every day, and stick with the trend. Rather than try to anticipate the impending disaster that so many think is coming, keep playing the long side as long as stocks continue to act in a positive manner.

We know a reversal will hit at some point and there will be some very ugly action, but there is money to be made while we wait. So far, the bears have been toothless and there have been few signs that the market is about to fall apart. In fact, the more the bears fight this slow, steady run up, the longer it continues. The dumb bulls who are oblivious to the danger are the ones who are doing well.

With option expiry today, there is a good chance of some reversal action next week, but the important thing it not to be aggressive about short positions until there is actual weakness first. Shorting into strength appeals to many folks, but it isn't working.

Like many other market players, I'd prefer a higher level of volatility and some profit-taking, but I have no choice but to trade what this market puts in front of me, which means that a bullish posture is the way to go. I'm rooting for a correction, but I'm not betting on one at this point.

Have a good weekend. Cook up a corned beef and drink some green beer. I'll see you on Monday.

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