Analog Device

Sometimes you picture me
I'm walking too far ahead
You're calling to me
I can't hear what you've said
--Cyndi Lauper

Are we in for a summer market swoon similar to 2011? The spectre has been crossing my mind.

In late July 2011 we had the budget stalemate plus early rumblings from Europe. Despite that, domestic stock markets were closer to their recent highs than recent lows. Action in many individual names seemed bullish.

Not that different from now.

There are bearish similarities as well. In addition to the Euro news, Treasuries were marking new lows. The SPX was tracing out a multi month up-down-up pattern with the recent 'up' seemingly marking a lower high.

One difference this time is that markets are at the edge of their seats in anticipation of more QE action from the Fed. Last year, it took a big swoon before the Pavlovian bell starting ringing in the heads of investors.

Feels deja vu-ish to me.

Personally, I've reeled in some long exposure in both stocks and commodities over the past week or so. Am currently sitting about 5% net long.

position in SPX