Less than 24 hours ago, we excerpted some of the most salient commentary from the latest Gartman letter, according to which "[S]trength is to be sold into; weakness is only to be bought after the market has been sold. If one sells a thousand shares on strength, on weakness one might wish to buy back only half of that, with the intention of selling another thousand on any subsequent strength. This is now a bear market; trade then accordingly."
More importantly, we noted that his latest trade reco, to short the S&P500, saw its blended stop price lowered from 2747 to 2741, one which was noted was just points away from being triggered.
Gartman 5 points away from being stopped out on S&P short https://t.co/ewdsgG8KsI— zerohedge (@zerohedge) July 5, 2018
Well, just a few hours later Gartman decided to end the suspense and in his Friday note confirmed that he was now stopped out, to wit:
... we have been short of the US equity market for the past several weeks and for a while that position looked wise, and in fact it was wise enough for us to have added to that initial short position, intending… as had been clearly stated… to add to that position again. Indeed, we came very close to having done precisely that. But all positions must be considered in light of each new day; risks must be assessed, and positions adjusted as needed. Simply put then, we are wrong in being short… for the moment at least… and as we write our stop order in the S&P futures has been touched off, for in yesterday’s commentary we moved our stop down in the nearby futures from $2747 to $2741, using our “hour or so” methodology to assure that the stop point had been proven valid. It has been and as we write we consider that most shall have been taken out of their trades at or near to $2743. Those that have not exited their positions should do so as soon as practicable. Apparently, trade tariffs; trade protection; and rising interest rates are good for equity prices. Who knew?
But fear not, he will be back:
Eventually we shall be short again of the equity markets, confident that the highs seen in late January in global terms shall prove to have been a bull market high; but for now we are wrong in being short with the market telling us for the past two days that we are and we listen to what the market has to say. As we have said many times in the past, there is nothing wrong with being wrong; however, there is a great deal wrong with being wrong and remaining so. There is even more wrong with adding to wrong positions and that we will not do. We live to fight another day.
And for those who desperately need another trade reco to fade, good news: Gartman is suddenly a fan of soy beans - the commodity slammed the most so far by the US-China trade war - if not buying just yet:
Finally, watch developments in the “bean” market and watch developments in the Mexican Peso and gold. Things are moving and our interests are piqued as noted at length above. Actually were it not for the fact that this is Employment Situation Report day we’d be taking action but we’ll wait until Monday for now.