Joshua Hayes'  Instablog

The Big Wave Trading portfolios remain under a SELL signal generated on 5/4/12. The current market environment continues to weaken as stocks among all sectors (even defensive-outside of gold) are breaking down. The BWT portfolios will continue to work the short side (long side with Gold) until a real uptrend returns. We do not expect an uptrend to return to the stock market until at least October. While we are short, we understand that the crowd is already getting scared and this could produce a bounce back to the 50 day moving average. Even if this does occur the BWT system model will not be switching to a BUY signal until accumulation starts to clearly outstrip distribution. The bottom line is that individual stock and ETF charts are broken in every sector, outside of the dollar, treasury bills, gold, and gold miners. Until these other stocks can correct themselves with some consolidation on lower volume followed by breakouts on strong volume, any NEUTRAL or BUY signal will be weak and unimportant. It is going to take time to correct the damage that has occurred. There is not much else to add as we have been under a SELL signal for a month now. It is summer time and while it is supposed to be a time of "living easy (Sublime reference)" it is clearly not for the stock market. Until the price/volume action changes on the overall market indexes by a wide margin on the accumulation/distribution readings, we will continue to recommend 100% cash for the public retail investors and short positions for active traders/investors. Aloha everyone and have a wonderful upcoming week.

Top Current Holdings - Percent Return - Date of Signal

BVSN short - 76% - 3/16/12
AVD - 75% - 1/10/12
LQDT - 65% - 2/1/12
UVXY - 62% - 5/9/12
MNST - 40% - 1/13/12
VRNM short - 34% - 4/10/12
PHMD short - 34% - 5/11/12
MAGS short - 33% - 4/18/12
PRXI short - 33% - 3/30/12
SINO short - 32% - 4/12/12
ABR - 25% - 2/29/12

Disclosure: I am long AVD, LQDT, UVXY, MNST, ABR.

Additional disclosure: I am short BVSN, VRNM, PHMD, MAGS, PRXI, SINO