Coasting Off the Rally

The trader's scaling out of dot-coms and getting long old tech.
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Oh boy, is it tough to communicate how I work. I buy weakness. I sell strength. We were looking for a snapback rally off the oversold position of the market (see my Sunday

piece). This rally is what we want and expected and as it goes higher -- and we think it will -- we will sell into it. We figure we coast on these numbers until we get near the employment number on Friday. That means green light until Wednesday, because on Thursday people will sell in front of the Big Bad Event.

As far as the

DOT

puts go, we bought 15 of them, when the index rallied. Fifteen! We expect the DOT to rally and we will buy five more puts every 10 points up. We think the DOT goes higher, too. That is the best time to short. We don't short weakness. That's how you get buried.

So, to reiterate, we are repositioning, buying bonds, getting long old tech and scaling out of ailing DOTs -- all DOTs. That is not a sin, it is just reality.

Random musings:

Big Editing E on the scoreboard. I bought bonds at 87 20/32, which mistakenly got translated to 87.06 in my last

piece. Wrong! Much different and I am sorry for the confusion.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was short the TheStreet.com Internet Sector index. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at

jjcletters@thestreet.com.