IH&S or H&S?

The market continued its rally from the 1539 low and it invalidated the bearish nested 1-2 count. And from the look of the wave, this could turn out to be a bullish W1 like the other two times we've seen this year. Also, the market closed above the Trend Average and threatening with turning the trend back to bullish with another solid positive close. Looking at this short term, the market seems like its headed to 1590 area based on the possible IHS and wave projection. However, the market also put in the right shoulder for the bearish Head and Shoulders (please refer to post from Friday) that targets 1503. One of these patterns will eventually fail, the H&S fails if the market goes above 1573, the IHS fails if 1538 is breached.  So the best thing to do at this point is wait for these levels to clear and get a better idea of where the market is headed.

I am still holding VXX and will sell if we get anything less than a sell off on the next bearish wave, specially if the 1545-48 area holds. I mentioned last week when the correction started that we could get an ABC to 1538 and then see new highs or a 5 wave count to 1520 with further downside to come and so far it seems like the ABC is the most likely.

Main S&P 500 Trends

Short Term Trend = Neutral

Medium Term Trend = Bullish

Long Term Trend = Bullish

Long Term Portfolio

• 100% Long in Red Chips traded in HSI (Mainland China stocks traded in Hong Kong) initiated September 2012. Only position trading 30-40% of portfolio for cost improvement. - Sold 10% on 12/27/12, Sold 10% 01/22/2013 - Bought back 5% 02/27/13 - bought 5% 03/01/13 - bought 5% 03/04/13 - bought 5% 03/06/13

Short Term Margin Trading Strategy

• Bought 3000 VXX@ 20.22 on 04/04/13
• Bought 3000 VXX@ 19.83 on 04/02/13 Sold 3000 VXX@ 19.99 on 04/03/13 = +0.16
•  Bought 1000 FXI @ 37.09 on 03/27/13 - Sold 1000 FXI@ 36.63 on 03/26/13 = -0.46
• Bought 1000 FXI @ 37.07 - Sold 1000 FXI@ 37.29 on 03/26/13 = +0.22
• Bought 1000 VXX@ 20.47 on 03/20/13  - Sold 1000 VXX@ 20.91 on 03/21/13 = +0.44
•  Bought 2000 FXI@ 36.21 on 03/19/13 - Sold 2000 FXI@ 37.08 on 03/20/13 = +0.87
•  Bought 1000 VXX@ 20.73 on 03/14/13 - Sold 1000 VXX@ 21.85 on 03/18/13 = +1.12
• Bought 1500 SPXU@ 30.98 on 02/27/13 - Sold 1500 SPXU @ 31.05 on 03/01/13 = +0.07
• Bought 2000 VXX @22.38 on 02/12/13 - Stopped out @22.38 on 02/14. Bought back @22.05 on 02/15/13 - Sold all 2800 VXX on 02/25/13 @ 24.30 = +2.05
• Bought 1000 VXX @ $25.78 as of 01/16/2013, Bought 1000 VXX @23.68 on 01/22/2013 - Sold @22.70 to position trade on 01/25/2013. Took loss $2.00
• Bought 1000 VXX @ $25.92 as of 01/15/2013 - Closed @25.96 on 01/15/2013 . = +0.04
• Bought 30 AAPL @ $509.50 as of 12/14/2012 on margin - Closed @514.50 on 12/17/2012. = +5.00
• Bought 1000 XIV @18.62 as of 12/13/2012 on margin - Closed @18.70 on 12/14/2012. = +0.08
• Bought 1000 XIV @18.80 as of 12/05/2012 on margin - Closed @18.88 on 12/07/2012. = +0.08
• Bought 1000 XIV @18.41 as of 12/04/2012 on margin - Closed @18.63 on 12/05/2012. = +0.22
• Bought 500 VXX @29.23 on 12/03/2012 - Closed @30.12 on 12/03/2012. = +0.89
• Bought 500 VXX @30.77 on 11/23/2012 - Closed @29..68 on 11/27/2012. = -1.09
• Bought 500 VXX @31.54 on 11/20/2012 - Stopped out @31.11 on 11/21/2012. = -0.43
• Closed position 500 @ 18.26 on 11/20/2012. Sold 500 @ 17.79, raised stop to break even on the other 500 as of 11/19/2012. Bought 1000 XIV @15.98 as of 11/15/2012 on margin - position trade cost improvement 4 cents, so net cost $15.94 as of 11/16/2012 - Profit = $2.05 
• Bought 1000 XIV @16.88 as of 11/14/2012 on margin - Stopped out @ 16.66 on 11/14/2012. = -0.22
• Bought 1000 XIV @15.67 as of 11/08/2012 on margin - sold 1000 XIV @ 16.25 on 11/12/2012 = +0.58
• Margin positions in Gold initiated 11/06/2012.

Net Profit since 11/08/2012 on open and closed short term positions = $5,220*  

* Margin position avg is $20k

* Margin position in gold is $4k