POSITION: Long Utilities (XLU)
This is the 3rd Short Covering Opportunity note I have written in the last 2 months (August 8th and September 12th were the other two).
I mention these time stamps not to take a victory lap, but to reiterate the confidence we have in our risk management process. It’s not always right. But it’s right a lot more than it’s wrong – and it’s repeatable.
Across durations, here are the lines that matter now:
- TREND resistance = 1237
- TRADE resistance = 1137
- TRADE support = 1079
I’ve covered our short position in the Consumer Staples ETF (XLP) and have bought back the only Sector ETF we like (Utilities – XLU), moving our asset allocation in the Hedgeye Asset Allocation Model back up to 6% from 0%.
Keith R. McCullough
Chief Executive Officer