Heres the deal as we see it. Our good friends at CNBC , who were hard long CLF at $65 and $70, today issued a hard short recommendation on CLF. By "hard" I mean they basically recommended shorting both the sector and specific stocks. These types of recommendations are typically not accompanied by any recommendation as to time or price to cover, so are highly suspect as to any real bona fides. Longs are better to ignore them entirely, since none of these folks has ever given an opinion on actual valuation on any stock I am aware of. And they seem to despise longs.

CLF's price may temporarily have gotten a little ahead of itself, primarily because a lot of CLF's great upward earnings leverages will only be partially felt in Q1 earnings. but will be fully felt in Q2. That involves a combination of both pricing and deliveries for both met coal and iron. For example, Great Lakes shipping goes high gear at end of Feb, not Jan1. Therefore, the stock has probably been puffed up a bit to generate weakness on the April 28 earnings report. But because longs all deal from the same 52 card valuation deck, the smack down will be short lived at best. I noticed CNBC cited a lot of fuzzy stuff about inventory, implying a China collapse, but anyone who follows the world metals markets daily will realize the metals cycle is closer to the beginning than the end. I will take advantage of that weakness to temporarily swap major holdings of AA, FCX, POT and others to CLF until Q2 earnings euphoria grabs hold (I figure this will begin by May 10-14). Just my strategy, but if all metals and energy were ready to collapse at this point, as implied by CNBC, look for the US to dive much deeper in the doggie-do. The Traders want the benefits of a "double dip recession" without there actually being one. Lets hope.

Mostly, we intend to just hang on, add on weakness, and avoid the one-sided calls from the airwaves. I believe most longs will opt to tough out the next two to three weeks since there is no quarter ends involved and they don't want to caught out if a bid ever comes in.