This brief comment below from the Legendary Trader Dennis Gartman. For subscription information for the 5 page plus Daily Gartman Letter L.C. contact – Tel: 757 238 9346 Fax: 757 238 9546 or E-mail: firstname.lastname@example.org or HERE to subscribe at his website
Finally, when it doubt we turn to the sage of the market, Mr. Richard Russell of the Dow Theory newsletter. Mr. Russel has been around for a very long while. He’s seen bull markets and he’s survived bear markets. Thus when he writes, we listen, and yesterday he wrote:
“OK, today I got three important bull signals, the great tide of the stock market has turned to bullish on the three counts I’ve been waiting for. The Dow closed at 10733.70 — at last above the critical 10725 level. This is a new high for the Dow, and it means that the Dow has finally confirmed the new high for the move on the part of the Transports. A Dow Theory bull signal — the primary trend of the market is bullish. At the same time, the great arm of the Dow has swung back above the 50% level. The Dow is now back in the bull zone above 10725. At the same time there were 627 new 52-week highs on the NYSE, a new high-total and well above the 523 new highs of January 11….An all-round historic day…
[So] what am I personally going to do about it? Honestly, nothing. Stocks are generally overvalued in this area…. Actually, the market is priced to produce losses over the years, particularly if you factor in inflation, commissions, dangerously low dividends and rising taxes.”
When great men are tacitly bullish, so too should we be. In our funds managed here we are skewed somewhat bullishly, being a bit net long, with the operative words here being “a bit.” We’ve a large number of shorts on to hedge ourselves, but we are modestly net long just because the trend is still up.
Can we imagine the nearby S&P futures trading back toward 1125-1130 over the course of the next several weeks? Of course we can, but at that point, we’d probably have to increase our net long position… and not modestly, but likely materially.
Richard Russell has made his subscribers fortunes. One of the best values anywhere in the financial world at only a $300 subscription to get his DAILY report for a year. HERE to subscribe. Amongst his achievements Richard was in cash before the 2008/2009 Crash and he has been Bullish Gold since below $300
Ed Note: Richard Russell is bullish Silver and holds one of the largest single positions he has held since the 1950’s in the precious metals.