Another week of summer trading came to a close on Friday with stocks managing to rally on paper thin volume in slow listless trading. This little rally closed out a week where stocks were able to bounce but unfortunately bounce with no conviction, fear, or volume. Overall, the market is extremely range bound with our momentum oscillators in the major market indexes still trending lower across the board with not one showing either positive divergence or a move off extreme oversold conditions.

As long as this market is showing no momentum internally, no momentum externally, is not registering fear levels in the VIX, and continues to see a rotation out of leading growth stocks into defensive stocks we will continue to operate with extreme caution. This is especially the case with us being in the middle of August with September still around the corner. While it is very possible that stocks could still rally this summer, seasonality is definitely not in the favor of bulls.

Despite the continued lack of upside momentum, we still have quite a few holdings trending higher with very little technical damage. At the same time, we are receiving very few new long signals. The good news is that our long signals continue to work (for now) and/or are leaving us with very minor losses. While we have received a couple of long signals that have failed spectacularly way too quickly, sell stops have prevented any measurable damage from occurring in our portfolios. On top of that, our hedge positions in leveraged ETFs continue to soften the drawdown we are experiencing off the highs in our long-term holdings that are failing.

Overall, we remain very mixed here with our portfolios around 50% long, 35% cash, and 15% short with 3x leverage. Our market models are also quite mixed, with the DJIA, NYSE, DJT and RUT under operational SELL signals, the SPX and COMPQ under operational NEUTRAL signals, and the NDX still under–miraculously–an operational BUY signal. So as you can see with the market and our personal holdings so mixed it does not make sense to completely lean to either the bull or bear side here. We recommend keeping a very open mind on the current market environment while realizing that the path of least resistance, at least for now, in the short-term, remains lower.

Have a great rest of your weekend and I wish you the best during the upcoming trading week. Aloha from a very sunny west side of Maui where the summer tourist season is finally starting to wrap up.

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

ANAC long – +295% – 1/20/15
SKX long – +155% – 1/26/15
PAYC long – +120% – 10/30/14
TREE long – +118% – 6/2/15
CBPO long – +95% – 10/24/14
VRX long – +80% – 11/17/14
DXCM long – +80% – 4/2/15
EA long – +76% – 11/10/14
ADPT long – +73% – 5/18/15
PANW long – +59% – 11/10/14
FIX long – +54% – 3/11/15
ABMD long – +52% – 7/10/15
NFLX long – +52% – 5/5/15
AMSG long – +46% – 2/26/15
AVGO long – +44% – 10/28/14
AMBA long – +43% – 5/14/15
SERV long – +43% – 11/7/14
AVOL long – +40% – 4/21/15
AYI long – +38% – 1/23/15
AMZN long – +37% – 2/25/15
BLUE long – +32% – 2/25/15
COKE long – +30% – 6/16/15
ULTA long – +30% – 12/17/14
SUPN long – +29% – 5/22/15
LHCG long – +28% – 6/11/15
ICUI long – +25% – 7/20/15
TILE long – +25% – 3/12/15