The Big Wave Trading models are currently under an operational BUY signal across the board without any negatives weighing against the models. There is a possibility, however, that prices will have a tough time moving higher from the levels that we are currently at in the short-term due to the Nasdaq and Russell 2000 being at the upper end of their long term uptrend lines measuring back to the start of 2010. The DJIA, SPX, and NYSE models are not there yet but are getting close.

It is possible that we will overshoot these trend lines this time around because for the first time since the uptrend started we are at these long-term trend line resistance levels but my oscillators that I track on the major market indexes are not overbought. In fact many of these oscillators on many of the major market indexes are moving higher now from oversold levels. So this is a new development here and will be monitored for future data mining adventures.

As it stands, as you can see below, all is well in the overall broad market if you follow price. Another positive for those that follow price, compared to those that try to trade using their “hunches,” “guts,” or “feelings,” is that if you do follow price and buy leading stocks at the proper time based on 130+ years of stock market history you are banking in this markets uptrend. Just look at our returns below. That is nearly half of our holdings in our accounts.

While we are doing very well at Big Wave Trading, we are not going to ever get complacent with the gains. We continue to move up our trailing stop levels so that we do not give back the majority of the gains we have realized. More importantly, we monitor our positions closely to make sure no new position that has initial gains turns into a loss. Losers are never tolerated here and they are eliminated ASAP.

This being said, we are in no hurry to give up our positions as long as they are trending higher. Once again, this week, the AAII survey and NAIIM exposure index made it clear that traders are more skeptical of these gains than any prior trip higher the past two years. The II survey also did not see any major rise in the bulls despite the markets breaking to new highs on the Nasdaq and Russell 2000. This is what we like to see.

On top of this, the last leg you need to get stocks parabolic appears to be taking shape. Our team monitors a lot of FB user groups, Twitter, message boards, and chat rooms to get a feel for the overall sentiment and to see what other traders are thinking. We have all noticed a new recent pattern. There are more comments that start out with the statements “I am new to the stock market and…” or “I am making my first trade ever and…” than we have seen since 2007. It appears that the retail crowd is now finally interested in trading stocks again. This doesn’t just go for the penny stock gamblers but we are seeing “savvy” gamblers wanting to play the higher priced stocks too.

All in all, this makes for a very interesting inflection point in the overall economic recovery. Will the Fed hike this year or next? Will QE4 be launched? To be blunt, we don’t give a shit. It’s all noise and as long as you focus on the noise you are going to miss the signals. As you can see below, we don’t miss the signals. When we get a signal and it is a false signal, we get out with as little damage as possible never ever holding on to that loser. We only want winners here. We have no time or room for losers.

Have a great rest of your weekend and we all wish you the best during the upcoming week. Hope it is a profitable one. If you decide to join us, we will see you in the chat room. Thank you for reading. Aloha from a beautiful west side of Maui where it is finally starting to warm up again.

TOP CURRENT HOLDINGS – PERCENT GAIN SINCE SIGNAL – SIGNAL DATE

VIPS long – +693% – 7/17/13
OVAS long – +365% – 8/8/14
AGIO long – +114% – 9/24/14
PAYC long – +91% – 10/30/14
SWKS long – +82% – 10/28/14
CVTI long – +67% – 11/3/14
ESPR long – +66% – 3/9/15
VDSI long – +62% – 8/4/14
RUBI long – +59% – 10/29/14
AVGO long – +58% – 10/28/14
ANAC long – +57% – 1/20/15
CBPO long – +56% – 10/24/14
VRX long – +49% – 11/17/14
SERV long – +47% – 11/7/14
EA long – +38% – 11/10/14
KITE long – +33% – 12/17/14
PANW long – +32% – 11/10/14
CNC long – +31% – 1/8/15
AFAM long – +31% – 1/8/15
LCI long – +30% – 2/5/15
BLUE long – +29% – 2/25/15