Gartman Covers His S&P Short – Liberty Craze

Gartman Covers His S&P Short

Posted by Tyler Durden on

While correlation does not equal causation, first thing on Monday morning, just as the Dow Jones was reversing all of its overnight losses and was set to surge by up to 500 points, we highlighted one notably "correlating" catalyst: Dennis Gartman announced "we are net short via derivatives."

 

Then in the aftermath of the recent ramp in stocks, a recurring question emerged among antsy shorters: has Gartman finally covered his (latest) short? As a reminder, the last time Gartman went short - just a few weeks ago - he was promptly stopped out just days later, as the market soared, only to crumble immediately thereafter.

So on Tuesday we delivered the bad news to the bears: as of 48 hours ago, Gartman no longer was net short simply via derivatives but had put on an outright short in the S&P.

NEW RECOMMENDATION: We have waited for strength into which to sell equities short and we got that strength yesterday when the President ‘Hinted” that he might actually move to exempt Canada and Mexico from steel and aluminium tariffs if they acquiesce on some demands to renegotiate the NAFTA. But again, the rally was on reduced volume compared to the volumes that came into the markets last week on weakness. This is how a bear market acts; now how bull markets act. We shall sell the S&P short this morning upon receipt of this commentary and the nearby S&P future is trading 2724.50 as we write. A 2% risk is more than sufficient at this point.

In response, we cautioned that "bears may be wise to wait the S&P to rise 2% before shorting."

Fast forward to today, when we finally have some good news for the bears, and to those who decided to wait for the extra 2%, your patience has paid off, because as of this morning, the "world renowned commodity guru" Dennis Gartman has covered his short yet again.... which is somewhat odd because he explicitly said he would short into strength, not cover.

Short of One Unit of the S&P futures: Having waited for strength into which to sell equities short we got that strength yesterday…Tuesday, March 6th… when the President ‘Hinted” that he might actually move to exempt Canada and Mexico from steel and aluminium tariffs if they acquiesce on some demands to renegotiate the NAFTA. But again, the rally was on reduced volume compared to the volumes that came into the markets last week on weakness. This is how a bear market acts; now how bull markets act.  We sold the S&P short then upon receipt of this commentary and the nearby S&P future was trading 2724.50 as we wrote. However, as noted above, the President appears to be relenting on the tariff issue AND the CNN Fear & Greed Index is turning for the better from ”single digit” levels and so with a loss of 0.1% we wish to cover this trade to live to fight another day. As we write, the nearby S&P future is trading 2728, which we sold at 2724.50.

And there is your green light.


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