Market Update

The market managed to add a few more points to the bullish wave from 1485 and the DOW came within a few points of its all time closing high but then all gains were reversed as expected. So tomorrow we should see the bears answer to the 40 point rally and I think it is now a monumental task to reverse all the bullishness in the markets but who knows? I am still watching the same level as yesterday so again, if 1498 holds and we get a quick bullish bounce, then the market will be headed towards 1550+. And btw I made a mistake yesterday (thanks TDD), the all time high is at 1576 not 1555. But I think a challenge to the all time high is highly likely on this coming wave or after the correction (if we still see more selling). Once there, it will be interesting to see if the market can break out of this range and go way higher. And yes, I know there are many bad news that the market seems to have completely ignored and as much as we rationalize it, it's just better to trade with the price trends.. again, the opinion vs fact battle. The short term trend average is now officially in neutral as we got 2 closings above the TA but the number is not trending up. So we should get an answer tomorrow or Monday.

I will be closing my hedge depending on how the correction evolves, the same can be said about some of the additional HSI longs added. For now, it seems like we will continue to rally.

Main S&P 500 Trends

Short Term Trend = Bearish

Medium Term Trend = Bullish

Long Term Trend = Bullish

Long Term Portfolio

• 85% 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

Short Term Margin Trading Strategy 

• Bought 1500 SPXU@ 30.98 on 02/27/13
• 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 = $2,625*

* Margin position is usually $15-20k