Overall a solid pullback in light volume with the major indexes ending the day near session highs. This is the type of pull back you would like to see in an uptrend. We avoided distribution even though we are in overbought territory. It is a good thing for us to consolidate gains. Of course we’ll need to resume the uptrend. However, next Wednesday we get another Federal Reserve meeting. Not to many will want to plow the market ahead of the Federal Reserve. While market is not pricing in a rate hike next week the market will be worried about July and September. Let’s not make this too complicated as we are getting solid price action. Do not complain.
You would think after a nice little rally the number of bears week over week would jump from last week. Not a chance! Bulls and Bears are about dead even at 27% for the week. Of course Neutral respondents to the AAII survey dominate once again. It really is not a surprise given what you read on Twitter and other social media and blogs. Interestingly enough there were articles out this morning regarding George Soros’ new short position. Effectively, Soros is short the S&P 500 and long gold. Much like Druckenmiller, Soros is now betting heavily against the market. Remember, these guys have billions of dollars and have the ability to hang onto these short positions. You better believe the retail crowd is feasting upon these news stories highlighting big short positions by well-known Hedge Fund managers. For us it here at Big Wave Trading we’ll simply follow price. We’ll let the other noise sorted out by those who find enjoyment in listening to the noise.
Not much to really report other than we continue to make necessary portfolio adjustments. Risk management is always a high priority for us. We care about our capital and we’ll protect it at all costs. Have a great weekend and we’ll see you back here next week.
