Aug. 24, 2012, 9:55 AM
Source: Business Insider
Back in February when the DOW crossed the 13,000 mark, Dennis Gartman said he had made a mistake reducing the size of his long position.He said, “you make it sound like I’m short of equities. Not on your life. Not right now”
Now Gartman, publisher of the Gartman Letter, who cut his long position by half earlier this week, has exited stocks entirely.
In his investor note he writes:
“Stock prices are weak as our proprietary International Index has fallen 62 “points” or 0.8% in the past twenty four hours. Having traded to 7805 earlier this week, this index is now down sharply from its highs… yet; but we are more and more fearful that it shall be, and having cut our long position in half earlier this week, and further having noted how rather badly the market responded to the belief that QE III was on the way, and noting that far too many individual stocks and one or two important international broad indices posted “reversals” earlier this week, we are exiting the other half of our long positions this morning upon receipt of this commentary.
Yes, we do indeed understand that this is a shift in sentiment; and yes we do understand that we had said that stock prices might “melt up,” and yes we further understand that we may look foolish in the weeks ahead for standing down, but call it trader’s intuition or call it what you will, but we wish to move quietly to the sidelines trust we are clear.”
Gartman, who says he is bullish of “simple things”, said earlier this week that the plunge in steel shares had signaled a buy.
But after receiving a report from a friend in a “small but influential broking firm in New York” downgrading the steel industry, Gartman writes, “we’ll ‘bet’ in its favour once again in the not too distant future, but not now given that we are standing down from our previous bullish posture this morning.”