Now even US ban shorting 799 US banking stocks following UK's actions. China declare they will buy the 3 main bank stocks with their funds. Read the news, so many pieces of news suggest the government will not let the banking system fails and rightly so. Remember i was also a shortist, but i gladly give up some profits and cheer this intervention by strong hands. Really, so what if i make from my shorts and see world economy goes down? Let's hope with Paulson's 700B proposal, the rut can stop and let us recover from there.
Short term wise, no doubt there will be a rally, any weakness looks like a buy to me. But one must be nimble. I will be wary for any strong hands distributing on the way up. The positive divergence adds strength to this rally. So when to buy? What to buy? I still prefer to wait for a pull back before deciding. Surely i will not short stocks for now. If the world is working hard to make it happen, either you join them, or you get the hell out of their way!
I covered my noble shorts on Friday and keep my synear short. The profits from the recent short positions will allow me to sit on synear until proven wrong.
2 Oct is the date where the ban on shorting will be lifted. Guys, remember now, supply and demand. Now they have ban shorting, it means they are tightening supply, demand will drive stocks up. But my point is, if everyone is buying and buying and price goes higher and higher... who is selling to them? There maybe an avalanche of selling once we tip the scale on the demand side.
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