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Dennis Gartman Turns Bullish at Trader’s Narrative

Dennis Gartman Turns Bullish

Dennis Gartman Letter logoDennis Gartmen, editor of the Gartman Letter, has surprised many of his readers by turning bullish after many months of being a very grumpy and vocal bear.

Until recently the only thing he preferred to hold was gold and he was negative on US equities and especially pessimistic on the housing sector, believing that it is far from a recovery. But now he has turned generally positive on the stock market and specifically, one sector in particular:

We were fortunate earlier this week when we turned bullish of stocks for the first time in many months, officially recommending that our clients step up and buy “the things that if dropped on your foot shall hurt.” We have returned to an old thesis that serves us well in years past, wishing to own copper, steel, coal and railroads, for these are the things we understand; these are the building blocks of global economic strength.

To his credit, Gartman turned partially bullish on Wednesday, before this Thursday’s strong up move in stocks. One of his favorite themes is to invest in “stuff” as in basic materials and related companies. In his newsletter he specifically points to the Materials SPDR ETF (XLB) which has formed a reverse head and shoulders formation.

To answer his befuddled readers as to why he has suddenly sprouted horns after being so pessimistic for so long, he writes:

We have been asked then recently… usually by our younger and more “self-certain” clients… “How can one change one’s view on equities so quickly? How can one go from being overtly bearish one week to being a buyer the next?” The answer we have is that one has no choice in the world of trading/investing, for holding to a losing thesis and remaining steadfast in that losing thesis is the one certain route to ruin in this business. The “quick” do not become the “dead” and the very best traders… the very best investors… are those who can say that the trend has changed…

Here is a recent CNBC interview where he outlines his “stuff” thesis:

And by way of comparison, here is a short clip from a few weeks earlier where he explains why he is bearish:

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17 Responses to “Dennis Gartman Turns Bullish”  

  1. 1 Market Sniper

    Tool, fool or seer? Jury is out on this guy. Longer term, NOTHING to be bullish about.

  2. 2 Chris @

    Reminds me of the saying - “Change or Die”. Regardless of the bullish or bearish macro view, at the moment there does seem to be an upturn in the market. In the next moment, who knows.

  3. 3 PJ

    Seems like the AAII sentiment index is now working. I don’t know about Dennis Gartman. What is his record. He is like the fast money crew they follow the market not lead it.

  4. 4 DoctoRx

    After the Bear Stearns bailout and relief rally in 2008, he went on record as predicting a major bull market. He said this was a major call and he had never been wrong on such major calls.

    FYI 2 brokers I know are euphoric right now.

    Watch out.

  5. 5 Aly S.

    Babak, I humbly request you stop presenting comments by guys Prechter, Gartman, and others who have terrible track records of accurately forecasting the market, in a positive light.

    These guys have a history of losing their subscribers money and continue to help their subscribers lose money.

    They are truly atrocious market forecasters, traders, investors, or whatever you want to call them.

  6. 6 Thalamus

    Dennis Gartman’s does have a publically traded fund if you want to verify his recent performance. Things have been so bearish I wouldn’t be surprised if we go up for a couple months before the elections.

  7. 7 Babak

    Aly, if they are truly atrocious, feel free to fade them.

  8. 8 Toeser

    He’s right. I am at my lowest cash position in months. Most of the Bush tax cuts will be preserved by Democrats who actually want to be re-elected. Of course the world sucks, but the general market direction will be up for at least 2-3 months.

  9. 9 gerard cage

    dennis gartman blows like the wind gold is up its down its up he dosent know squat.

  10. 10 Aly S.

    Exactly. Anyone who’s followed Gartman knows he simply blows with the wind.

    Now, he may be right about turning bullish but even a broken clock is right twice a day.

  11. 11 aussiegringo

    Gartman’s raison d’etre on CNBC and Bloomberg is to sell subscriptions to his newsletter. His results are terrible, his newsletter is garbage and he is a politico blowhard. His newsletter is about 6 to 7 pages wrong. Merely removing the repetition would bring it down to 3 pages. Eliminating the political garbage would bring it down to 1 or 2 pages. He rarely provides any details about what trades he has taken, or when, or his target exit, etc. Why? Because the point is not to make money trading, it’s to make money selling the subscription. If you pay attention to what he says on the air, it’s not at all enlightening or informative. Many online bloggers are far more instructive than Gartman.

  12. 12 aussiegringo

    The issue with Gartman is not that his calls should be faded. The issue is that with limited time and mental energy, who wants to listen to one more inane, useless interview with somebody like Gartman? If somebody thinks that the Euro is going to disappear, or that Obama’s policies are socialist and will therefore cause a double-dip, then that person should provide an intelligent argument when on national TV. Gartman expounds those beliefs on national TV without argument of any merit.

  13. 13 AB

    Gerard, Aly, and Aussie are correct - Gartman isn’t the market prognosticator he or CNBC makes himself out to be.

    I’ve read one of his letters, a lot of hot wind. One could do better simply by becoming a better chartist.

    Doesn’t it seems strange that he suddenly becomes bullish after the market starts to show increasingly strong internals?

    I’d like to see the market tank really bad in August, see Gartman turn bearish, and then rally back from a shakeout - just to embarrass him. Would be a laugh!

  14. 14 gp

    AB, people like Gartman have no shame to be embarrassed - but suckers keep paying for their advice. But I do admire how the Gartman types know how to market themselves and make tons of money. If he wrote a book on THAT I would definitely buy it LOL

  15. 15 AB

    gp, I personally know one of Gartman’s disciples - started his own newsletters - and maybe at one time he and Gartman made a lot of money from selling them. But a couple bad market calls nearly destroyed his reputation, he lost over half his subscribers very quickly. And nowadays, a subscriber can easily forward those same paid letters to 10 of his friends, and so on, so how do you sell when it’s so easy to spread the stuff? I will also say that from this disciple I received access to a very expensive market service, and I haven’t paid one cent for it.

    I’ve no respect or admiration for these guys - all of my respect is for the traders who spend all their time focusing on making a killing for themselves and making a killing for their clients, rather than trying to be prognosticators and sell newsletter subscriptions.

    I’ve learned from experience, in the markets, better learn to choose your own surfboard and master it, because if you mess with one that someone recommends but really doesn’t fit you, you’ll get clobbered very fast.

  16. 16 Nicky

    I was a broker for 4 years and read The Gartman Letter frequently during that period. It is usually a resource available at most investment banks along with analyst reports from internal and external sources.

    I never used the recommendations. Anyone looking to follow someone else’s decisions should, in my opinion, just buy mutual funds. In fact, Dennis refers to himself as a trader and a regular reader would come to understand that his implied recommendation is that you develop your own trades based on your own determinations. He provides his trades only to give you an insight into what he is doing on his own.

    The strength of his letter is to give you the reader an insight into the institutional perspective of what is happening in the trading world. I believe he was chief economist for the cotton board or something quite a while ago. Like it or not, his letter is very widely followed by both institutional buyers and sellers.

    In my opinion his reasoning is valid and the distillation of relevant news in the early morning is very useful, especially when combined with a good cup of coffee. However, having sold products containing his direct recommendations, his actual trades and recommendations did not do well at all.

  17. 17 leo goodman

    i watched Gartman on CNBC Dec 28 and HE IS A NOTHING WINDBAG!

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