The Trading Almanac

A diary of investments in my IRA, a daily look at my stock watch list, and additional commentary/discussions on individual stocks, the overall market, economics, technology, etc.

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Thursday, January 19, 2006

Small Caps on Confounding the Pundits--and Me!

Russell 2000, new high. Buyers are ignoring the Large Caps and are buying momentum. Isn't this finally the year that the Small Caps were going to be sold off in favor of larger, more stable companies? Not yet. And I'm 34% cash. I've been caught flat footed with my 3 holdings experiencing a consolidation period and my watch list giving me many opportunities to participate, but I didn't pull the trigger.

As it is, I'm pleased that Apple's post-earnings downside has been reserved. And Google can't go up everyday, can it? Whole Foods looks like it has turned back to the upside after bouncing on a short-term trend. Tomorrow I will look to put some of my cash to work, if conditions allow. It is essential in situations like today's when I feel "left behind" to not blindly dash in. Prudence is key.

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