Give me your tired, your poor, Your huddled masses yearning to breathe free, The wretched refuse of your teeming shore.
Beaten, broken, but not dead. Oh, and boring.
That's a theme that continues to work, and, ironically, I think the market bounce won't fizzle until the boring names fizzle first.
Yes, I'm talking about very big-name, blue-chip, non-momentum-associated names, but also stuff such as utilities. Boring, but a 6.5% gain for the group for this year alone.
Are you kidding me?
And when I look at bottom dwellers such as 3D Systems (DDD) bouncing nearly 100% from its January lows or even Twitter (TWTR) -- yes, Twitter -- suddenly showing some life, I feel we need to keep our eyes on these areas. But I also like these names until the trend changes. It's what drew me to Kate Spade (KATE) and Veeva Systems (VEEV), and why I'm looking at Ciena (CIEN) today.
It won't draw me into something such as Ocwen Financial (OCN) or Altisource Portfolio (ASPS) or even Valeant Pharmaceuticals (VRX). Bounces and turnarounds are one thing, but falling knives are not the order of the day here. While I do think VRX has the best chance of the three, from a technical point, there's no need to risk it and we're talking about huge fundamental question marks without answers currently.
So we'll have the Beige Book thrown at us as the markets still digest Super Tuesday. Both are single-point, focus-on fluid events. They aren't worthy of short-term trades or even a short-term mentality, so I would avoid these in any short-term or scalping decisions. I would view them as pure macro plays and focus your thinking on those as a basis for any long-term investing decisions here rather than short-term trades. Currencies, and as a subset, oil, still are driving that market, with China looking officially out of the mix for the moment.
While I like some of the life we're seeing in financials, I really would prefer to see it come back to biotechs. It leads us back to the first thought. How far can boring take us? I don't see a resurgence of value lately, yet we're going to see the big-cap value names get priced out of that space if this continues.
I want to see speculation again after a period of consolidation here. If it were my call, we'd consolidate the SPDR S&P 500 ETF (SPY) between $193 and $200 through April 15 before pushing higher. Alas, I'm a commentator rather than a director, so it's out of my hands.
Let's see what the Fed says and how the market reacts, but I want to see some of the above move from outline to action here in the next few weeks to buy into the belief we can see the recent highs of November tested again.
