Chinese, Resource Stocks Pop

The rally in the stock market continues to cause big single-day gains in many stocks. General Steel Holdings (GSI) and Spreadtrum (SPRD) both popped 19 percent today; both are in my China fund. Massey Energy (MEE), held in my Best of Funds fund, climbed 21 percent. Teck (TCK) added another 13 percent and is now up 125 percent in the Best of Funds and 350 percent in the Green Dragon fund.

This has the hallmarks of short-covering or market melt-up behavior, but I've been early with my shorts in the Best of Funds. Many investors are looking for at least a correction, but none has arrived. Right now, I think this could be typical "buy the rumor/sell the news" behavior, and we might see a decline when the stress tests are released on Thurday, or possibly the day before.

P.S. My short fund continues to get annihilated.

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