If anyone needed a catalyst to know that last week was the time to short stocks, it came a little over a week ago when everyone favorite windsock, Dennis Gartman, went "all in" long of stocks, in paper money terms of course. The subsequent tumble has been duly noted here.
So just as it seemed safe to pile into shorts today, now that the US economy is not only about to lose countless high-paying, energy-related jobs and energy companies will stop buying back their stock at a torrid pace (incidentaly, they should be buying when their stocks are plunging, not at the all time highs), but deflation is soaring to levels last seen during Lehman [4], and the Fed - at least superficially - is still determined to hike rates, here comes Gartman with a note that makes a dead cat bounce virtually assured.
The S&P: This has the ominous look of what some of the Old Guard amongst the market technicians used to call “Three Peaks and a Domed House” pattern, which always gave way to substantive weakness. All we know is that Friday’s action was horrific and that the volume swells on the downside these days, and wanes on rallies!
Translation: the biggest short squeeze of 2015 may be imminent.
And sure enough, stocks have stormed higher in the 40 minutes since we first blasted this most bullish for the S&P update:
Warning: Dennis Gartman has flipflopped to bearish today
— zerohedge (@zerohedge) February 2, 2015 [5]
Best $29.95 ever spent:
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