Keep Out: Obama, Bernanke, Apple making stocks treacherous

Cartoon by Branco. Reprinted by permission, via

WASHINGTON, January 28, 2014 – Our trading advice today: None. The market is currently up, but making any definitive moves is much too dangerous, with Apple’s allegedly poor numbers, tonight’s yawner of a State of the Union address via teleprompter, and Wednesday’s long-awaited Fed taper update serving to keep stocks in continuous freakout mode.

(For more on Apple, see today’s Prudent Man column.)

Markets are experiencing a nice bounce, alternately up between 40 and 60 Dow points and 5 to 7 S&P 500 points as of 1 p.m. EST. But the NASDAQ is firmly down again today, with our headline stock, AAPL—overrepresented in the tech averages—continues to put severe pressure on this mostly-tech index.

In addition, the market tried to make a comeback yesterday and failed. Clearly, many professional investors, hedgies and HFTs are unloading rather than face tomorrow’s Fed announcement about its latest tapering plans on the eve of Ben Bernanke’s departure as chair. So we’re wondering whether today’s rally attempt will ultimately fizzle, too.

Further, the short positions we put on yesterday, detailed in yesterday’s column, are either still slightly up or only slightly negative today indicating we have a lot of company here. Today’s current averages are telling us we should be down much more on these shorts, but we’re not. Which means bearish investors are still hanging in there figuring that the worst is yet to come.

You never know these days. But we’ve dumped most of our longs and are holding the short ETFs, at least for now.

One interesting thing to note. Our modest position in GTAT—the future sapphire film and/or glass supplier for upcoming Apple device screens—is still up this afternoon as it was yesterday, even as the market and Apple stock tanked. So we continue to hold that position for now, currently up from its secondary offering by approximately 12 percent.

Perhaps the behavior of this small, as yet unprofitable company is a tell on where Apple might be later this year after their rumored new iPhone 6 hits the market.

Credits: Today’s cartoon by Branco, courtesy LegalInsurrection.

Disclaimer: The author of this column maintains several active trading and investment portfolios and owns residential and investment real estate. He currently owns shares of  GTAT, HDGE, SH, SDS, EDZ and SKF.

Positions mentioned above describe this author’s own investment decisions and should not be construed as either buy or sell recommendations. The current market is highly treacherous and all investors travel at their own risk. Caution should be exercised at all times.

Illustrations, charts, commentary, and analysis are only the author’s view of current or historical market activity and don’t constitute a recommendation to buy or sell any security or contract. Views, indications, and analysis aren’t necessarily predictive of any future market or government action. Rather they indicate the author’s opinion as to a range of possibilities that may occur going forward.

References to other reporters, analysts, pundits, or commentators are illustrative only and do not necessarily represent an endorsement of such individuals’ points of view. If specific investment vehicles are mentioned in any article under this column heading, the author will always fully disclose any active or contemplated investments in said vehicles.

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Terry Ponick
Biographical Note: Dateline Award-winning music and theater critic for The Connection Newspapers and the Reston-Fairfax Times, Terry was the music critic for the Washington Times print edition (1994-2010) and online Communities (2010-2014). Since 2014, he has been the Business and Entertainment Editor for Communities Digital News (CDN). A former stockbroker and a writer and editor with many interests, he served as editor under contract from the White House Office of Science and Technology Policy (OSTP) and continues to write on science and business topics. He is a graduate of Georgetown University (BA, MA) and the University of South Carolina where he was awarded a Ph.D. in English and American Literature and co-founded one of the earliest Writing Labs in the country. Twitter: @terryp17