Would you have preferred to go home long at the close on Friday, or short? That's a question we frequently ask in the Rick's Picks chat room toward the end of the trading day ' a little game we play to position ourselves for the next day, in true contrarian fashion, against whatever strategy feels most comfortable. If we have succeeded, we will have placed ourselves, psychologically speaking, squarely in harm's way. We do so knowing that the only possible buyers of shares these days -- other than Kudlow and friends, of course -- are bears covering short positions suddenly turned painful. It therefore follows that if bears seemed mellow and complacent at Friday's close, we should have wanted to load up on stocks, since any news over the weekend that might cheer investors even slightly would be likely to touch off a short-covering tizzy come Monday morning. However, if bears seemed fearful, running up share price in the final minutes, then we should have wanted to go home short up the wazoo. (Click on chart to enlarge) Truth to tell, we had trouble discerning a psychological 'comfort zone' to trade against Friday afternoon. Although the Dow finished down nearly 200 points, that was 120 points off the lows, and there were no clear signs of panic by either bulls or bears as their respective opportunities to freak out dwindled in the final hour. If it had been a game of chicken, both drivers probably would have been content to go over the cliff. Hell Week With no signs of craziness to guide us, we found ourselves weighing the facts, dismal as they are, and concluding that stocks are far more likely to go plummeting into the bowels of Hell next week than to continue acting as though we'll somehow get through this mess together. Although Optimism is
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