The Big Wave Trading models did a quick turnabout this past week as our NEUTRAL to BUY operational signal lasted all but a few days. Following Friday’s stock market action all of the major market indexes are now back in their trading ranges of the past 1 1/2 months. Therefore, logically, all of our models have returned to an operational NEUTRAL condition. Despite the NEUTRAL conditions, we continue to favor taking long signals as the overall trend remains higher on longer-term time frames.

Friday’s market action was not really a surprise to us at Big Wave Trading as we were all complaining about the lack of follow-through to the breakout to new short-term highs in the indexes. Once the 3/25 HODs were taken out, the market should have exploded higher with strong closes confirming the move. Not only did the market not explode higher we never closed strong once before Friday’s sell off. Three attempts. Three failures.

It would not surprise us if we continue to trade in this 1 1/2 month congestion area on the major market indexes for a while longer. There are too many mixed technical signals out there with some sketchy sentiment. This combined with the recent lackluster follow-through to the upside in our long positions is problematic but it has not turned into anything serious yet. We will continue to take long signals as they show up and keep tight stops on new trade ideas.

This weekend is about taking stock of our current holdings and raising stops to appropriate support levels so that we ensure that we lock in most of our hard earned capital gains. There are still a lot of stocks in solid consolidation patterns but once again there is definitely not anything out there right now really stands out in individual leading stock’s chart patterns. It’s pretty lackluster and nothing indicates that is going to change any time soon. Our oscillators are mixed and our indexes are in trading ranges. It’s hard to come to any conclusions about the future direction of stocks when this situation exist. Patience is key.

We will continue to exercise our patience in this tape, giving zero patience to new long signals that do not move higher immediately. If we get long a new signal and it does not move higher immediately, we will not give it any breathing room and will eliminate it quickly. The crowd is still complacent overall and I did not see any real fear in the VIX on Friday. Until I see some real fear out there in the selling, it is going to be hard for me to get too excited about any rally attempt. For now, it is just going through the motions. One day, those motions will reverse. Until then, when a signal generates, we are going to take it. The trend is still up and interest rates are not rising. Yet.

Have a great rest of your weekend. I wish you all a very profitable upcoming week. Thank you and aloha.

TOP CURRENT HOLDINGS – PERCENT GAIN SINCE SIGNAL DATE – DATE OF SIGNAL

VIPS long – +707% – 7/17/13
VLTC long – +220% – 4/2/15
AGIO long – +114% – 9/24/14
ANAC long – +98% – 1/20/15
VDSI long – +77% – 8/4/14
CBPO long – +71% – 10/24/14
PAYC long – +70% – 10/30/14
SWKS long – +68% – 10/28/14
RUBI long – +58% – 10/29/14
CVTI long – +54% – 11/3/14
VRX long – +50% – 11/17/14
ESPR long – +50% – 3/9/15
AFAM long – +46% – 1/8/15
AVGO long – +44% – 10/28/14
BLUE long – +37% – 2/25/15
TERP long – +36% – 1/16/15
EA long – +35% – 11/10/14
SERV long – +35% – 11/7/14
PANW long – +30% – 11/10/14
CNC long – +27% – 1/8/15

RCPT long – +33% – 2/20/15