While no one can say exactly when this bull market, now in its 25^th year, will finally succumb to gravity, it is still possible to get short whenever we please, and with relatively little risk. Take yesterday, for instance. In the Touts section of Rick’s Picks  we recommended shorting two especially juicy targets, Goldman Sachs Group (GS) and Time Warner (TWX).  Although both ended the day sharply higher, that didn’t hurt us one bit. In fact, we actually booked a partial profit on the Goldman trade, allowing us to remain short the stock without being the least bit nervous about it.

How, you might ask, is it possible to make a few bucks being on the “wrong” side of a bull stampede?  Chalk it up to Hidden Pivots. We used some very promising ones that allowed us to short Goldman within one cent of its intraday high and TWX within four cents. However, long experience has taught us that when a short position goes our way, it is always advisable to take a partial profit before patting ourselves on the back. This always pleasurable task was easy enough yesterday in Goldman, since the stock plunged a blissful $2.43 after kissing our target. The less-volatile TWX proved more challenging, though, and we opted out of the trade even though the May 20 puts I’d suggested buying never went lower than our bid.

No Predicting Tomorrow

Two bullseyes, but what about tomorrow?  In fact, there is no predicting “tomorrow”. For all we know, the Dow could be up 500 points by day’s end. And that is why our goal is never to try and call" The Top,” but rather to continue leveraging promising tops such as the ones that occurred yesterday in the shares of Goldman and Time Warner. Nor should we ever be remiss in taking a partial profit on a trade as soon as a respectable profit is available.  

It will be no different in a bear market, since the downdrafts that are destined to take the Dow Industrials to almost unimaginable lows will be so steep, and punctuated by corrective spasms so violently unpredictable, that any bear who lets a self-congratulatory thought distract him for even a moment is going to be bear jerky in the blink of an eye. That said, although we will continue to respect an aging bull that any disinterested bystander would surmise is loco, we have no reason whatsoever to fear it.