Legend has it that the shorts are “usually right”, after all they do more homework. Right? Jim Chanos was shorting Enron when the clueless bull market geniuses in their ivory towers were issuing strong buys at the bulge bracket firms.
John Paulson made the “Greatest Trade Ever” as he was short sub prime and the insurers. The analysts loved those stocks too, all the way down to a drill bit.
First Solar (FSLR) just broke $100 yesterday for the first time since November 08, it was heavily shorted. If you’re caught leaning the wrong way however, a short squeeze can be a widow maker.
It’s your money, so you decide.
The market had a vicious sell off at the open yesterday, only to trade sideways until about 2pM when stocks got off the mat and caught some lightening in a bottle. Great trading and great volatility. It’s easy to get whipsawed in this market, so stay nimble.
Friday, February 26, 2010