Today was yet another impressive day for the bulls overall. However, once again, volume was lacking on the move. But the difference today over past market rallies is that I did have quite a bit of longs in my main long scan and on today’s strong rally I did have two shorts that I had to fully cover where on other days this has not happened. On top of that, I did not get filled on my SFG short so that short is eliminated. After tomorrow morning I will have 10 shorts and 11 longs and will still have around 85% cash so obviously that is very telling–this market is beyond mixed/listless. The short term trend off the July lows is up but the overall trend since the April top is clearly down. The time frames between and outside of those periods, for 2010, is completely mixed. It is still not clear which way the market really wants to go here. While past leaders of the 2009 bull are breaking down more and more with ISRG, NFLX, and now AMZN joining the ranks of others like GMCR, CMG, PCLN, etc…, we have other stocks that are still holding up quite well like CRUS, VMW, CRM, NTAP, and other select stocks. So it is definitely mixed out there and anyone that is a “hardcore” bull or bear here is definitely siding with their emotions. The truth is that right now there is no clear trend and therefore you can not be a “confident” bull or bear if you invest using facts and not emotions. If the market was trending higher on extremely strong volume then you better be sure we would be going long every beautiful breakout in a beautiful chart pattern or strong CANSLIM quality stock. If the market was breaking down on strong volume with barely a rally out there then we would be going short every failure at every moving average in the past leaders. Neither scenario is really working out like that right now. Cash is king and time is on the side to those that truly have a passion for this game and can wait out these tricky markets. Stay patient everyone a clear trend will emerge. I just don’t know if it will come before Labor Day. I know I can wait to make the big money while keeping my powder dry so that I don’t lose the gains I have accumulated already this year.
new short positions: none
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