Matt Gohd Is Worried About This Rally
The stock market rallied massively in October, with the Dow up more than 10 percent in the past month.
Revere Capital's Matt Gohd, who has been consistently right on major turning points, thinks we may be heading for a turnaround.
One thing that has him concerned is the rampant enthusiasm over the supposed resolution of Greece's problems.
"It's still not a done deal and requires real capital to complete it," Gohd says.
He's also concerned about the rally in commodities and commodity stocks. Much of this may be driven by hopes for more infrastructure spending in China that Gohd suspects might never happen.
"With 10 percent inflation and 8 percent plus growth rates, this may be a stretch and could lead to sell off in those names," he said.
Gohd thinks recent market action might not bode well for stocks.
"Yesterday's explosive rally was primarily led by short covering and this could leave a 'demand vacuum' below the market that would create a sharp move lower," he said.
Gohd is looking at put option based positions on Freeport-McMoRan Copper & Gold, Caterpillar and the financials. He's also hedging market risk for a sharp pullback.
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