This market continues to remain tight range and today was no exception. The Nasdaq once again hit an all-time high, but failed to close out near the highs of the session. Volume was mixed with Nasdaq volume falling short of Monday’s level while volume on the NYSE was higher. What we are now hearing is how the low volatility is becoming a real issue and the VIX certainly shows there is a lack of fear in this market. Investors simply do not anticipate any future volatility. While we continue to see, earnings pour in we will continue to work our process. Cutting losses quickly is key to our success as well as how we use our position sizes to control risk. We can only trade the market in front of us and it is a waste of time wishing for something else.

North Korea confirmed its plans to go ahead with another nuclear weapons test. The market flinched, but quickly recovered the losses. It appears the market is going to ignore news from the communist country. We are certainly no experts in international affairs and there is absolutely no chance we are going to try and figure it out. Price is our only guide and we are going to follow the trend in place. Stick with it and ride it.

The ultra-low VIX is certainly playing games with those who rely on market volatility. There are plenty of hedge funds who play the volatility game and they are hurting. Trend following CTAs are hurting as well as the lack of volatility and trends in commodities have hurt. Stocks have been the game to play and many Trend Following wizards are overly diversified. This uptrend has treated as well and while pre-2008 we would have seen massive winners we must except what the market gives us now. Perhaps in time we will see those types of gains again, but we are not going to hold our breathe.

We are going to continue to monitor our positions and adjust stop accordingly. Managing our risk is our top priority as it protects our hard-earned capital. We’ll continue to grind out this market and continue to reap the rewards.