The Big Wave Trading portfolio remains under a BUY signal, generated on August 3rd, as the market continues to move higher on well above average volume. On Thursday, for the first time during this rally, we saw the indexes, ETFs, leveraged ETFs, inverse ETFs, and leveraged inverse ETFs all move in the right direction on well above average volume. This is the confirmation we need to start to increase positions in new longs and to look to buy the dips when the dips do come in leading stocks that are short term too extended from their 50 or 200 day moving averages.
The increase in volume during the past seven trading sessions and the improvement in the breadth of the advance/decline line and the upside to downside volume is excellent to see, if you are long and/or are expecting further price gains. September and October have historically been months when the stock market stages strong rallies. March is another month where powerful rallies begin. This rally started before Labor Day and the current action is definite confirmation that the trend for now must be respected.
Now, I know a lot of individuals are upset at why the market is rallying (backed by Quantitative Easing). I share your concern and agree that it is the wrong policy for wiping the slate clean and starting a real economic rebound. Putting a band aid on a femur shaft fracture isn't going to fix what is really wrong. However, maybe they don't want to fix what is really wrong. And this is my point. Price is all that matters to us.
These individuals that are in charge around the world, that make horrible decisions against the voice and concerns of the tax payers, are going to do what is in there best interest. Not in what is our best interest. What is in your best interest, knowing this, is to take control of your future by learning how to invest in a solid time tested proven trend following methodology. That is the only way those in the bottom will ever be able to save any money. With inflation the way it is and with bank CDs rates so low, what other choice do you have? That is what we are here for. Aloha and enjoy your weekend!
Top Current Holdings - Percent Gain - Date of Purchase
AVD long - 115% - 1/10/12
BVSN short - 82% - 3/19/12
NTE long - 54% - 8/17/12
CLGX long - 54% - 6/19/12
CAMP long - 32% - 4/26/12
PRXI short - 30% - 3/30/12
VRNM short - 29% - 4/10/12
PXD long - 28% - 7/17/12
MAGS short - 28% - 4/18/12
SVNT long - 25% - 9/10/12
Additional disclosure: and short BVSN, VRNM, MAGS, PRXI