Happpy Halloween

Tonight I have something extra spooky - the portfolio snapshot - which has shown a rapid deterioration over the past two weeks - mainly due to the two foolhardy shorts of the XLF in addition to the broad decline in gold and the goldminers.

Portfolio snapshot:

Thoughts that immediately come to mind are fear, regret, and loss aversion. After briefly touching the $13,900 mark less than 1 month ago - portfolio has been decimated by excessive speculation in Gold, and the Financials. Got the direction wrong on both and also had timing issues as I was unable to wait for a turn and made too short term of a bet.

The current manueverings which are planned for later next week include putting all of the remaining cash into NCTY prior to earnings. I figure that 25% downside risk is possible on earnings day and a move from 18 into the $13.50 area entirely possible if earnings are to dissapoint. At the same time I think that $30 is possible by the end of the year in the instance of a solid report which is what I am expecting.

So far this year the portfolio started with around $5,000 with a temporary dip into the $4,200 area. An additional $2,000 in capital was also added. By any measure as of today at least (who knows tomorrow....lol) - the portfolio is still up approximately 15% - even after giving back SO MUCH of paper profits. The question is if now is the time to up the ante and make a bigger move even when I am down.

I have decided to do it and it will be interesting to contemplate the significance of this probably too risky manuever around two weeks from now. Another very important tendency I am fighting right now is a desire to reshort XLF again with remaining funds. The problem there is XLF is actually strengthening as we speak and gathering broader and more following in the market. As deceptive and false as I believe this move is and that vindication will be coming shortly, it is not healthy to keep telling yourself that you will be right when the market has proved you wrong with actual price action.

Tonight's post is probably a bit overanalyzing - but it is very important for me to be true to my thought processes and document them in order to hold myself accountable later for the wins and the LOSSES.

That is it for tonight - there are going to be some newsworthy items out later this week including the fed discussion tomorrow afternoon - so I will be posting again soon. :)

Regards,

BG