The short bias today is based on the euphoria of the past week and is centered on sectors that are more sensitive to the whims of trend-following (herding) investors. High-beta sectors have become a bit over-extended pre-Christmas holiday. There is likely to be a pause in these names relative to the market, and if we have a small downleg, they should correct more to the downside given their "mood-sensitivity" (versus the potential upside if the rally continues).
On an individual stock basis, our short on $ARNA paid off yesterday, and we're also getting short-term short signals on Skechers ($SKX) - which is extended to the downside already, so be careful.
Happy Trading!
Richard
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