Le Update

I'm still here, but laying low - decompressing in fine French fashion. While today may begin to show different, nothing in the action of the market has been too terribly inspiring and that has suited my vacationing mind quite well.

There are plenty of strong charts out there still and I wouldn't be surprised if we turned higher soon, but I need the market to manage something of a short-term low before getting involved. I am okay with missing the beginning of a rally, when and if something ensues, and I'm not interested in taking on shorts if things worsen; being on holiday.

If I were a nicer guy or on a normal schedule, I would list the leadership stocks I currently consider best poised. No such luck for you in the month of July, however. Get a haircut, go outside and I'll continue to rest-up and write but little; though I will convey new trades via Twitter.

Also, for the few who expected entertainment whilst I was away, I clearly mismanaged expectations. I've been much busier doing nothing than I ever realized. That may get flowing soon, but don't get too eager when you reload this page; I'm capable of disappointing your kind even longer.

Regarding my position I still have PEET (3.7%) and MRVL (3.4%) long, which refused so far to stop me out. As well, I just added 6.66% long EWT long, but this is more of an intermediate-term play and not a trade (assuming nothing dramatically negative develops in the Asian markets).

Don't do what I do, but I'm still keen on buying Asia on pullbacks. Taiwan in this case.

Exit Strategy (unloaded en masse)

Definitely a change of plans here as the market action has shifted to questionable/negative.

While I took body shots on the CYOU and SNDA pair yesterday, today I had my guard up, unloaded those two early, and then proceeded to hedge and unload countless others following the consumer confidence report.

Not that I see consumer confidence as so key - but it is the market reaction. A negative surprise AND striking a chord in the market is enough for a guy already looking for where to find the sidelines. July is a gentle month for me, as far as the market goes. We'll see if I can't drudge up enough action then elsewhere.

I'm left at the moment with four longs, married to none, stops tight in two and enough SDS to render myself net-short for the time being. I'm not looking to hold short, but today is rather defined, my entry there was decent enough and I don't yet see any reason not to hold the full throat until the end of day.

I'm on the Amalfi coast at moment, but somehow with a better connection than anything else this past week. Good day for it too, since I was quite active.

So ciao ciao for now, I'm heading for water. There's no big game in this particular sea, but at least I can't get too bit. I'll update further trades via Twittwatt, but those should be winding down for the time being. If/when the market pivots and drives higher, I might get involved. But I am only interested in July if it is one-way action. I should be out of SDS by today's close and sell most of the four remaining by endo of the week (which now I know is Thursday ;).

Total Position: 1.40-to-1 net-long (actually plays ~1.40-to-1 net-short, considering 2x's levered SDS), 25% invested

Currently Long (according to size): ARST (4.2%), LFT (3.8%), PEET (3.5%), MRVL (3.5%)

Currently Short (according to size): SDS-long (10.4%; SP500 dbl-short)
(Note: inverse-ETF SDS represent being dbl-short the respective index)

Futures Accounts: no current position

Pom Payday

Arrived yesterday in Naples and heading to Pompeii now for the day (Vesuvio tomorrow). Overnight futures are down slightly but leadership has remained quite game at the same time that the overall market lumbers in a mild uptrend (my favorite type of action for simply holding onto to winning positions).

As long as this continues I can keep with the plan of holding into the July 4th holiday seasonal strength; with the idea of selling names on Thursday (2nd) [edited] and then early Monday (6th). Given the nature of the recent action (leadership growth behaving very strong under the otherwise quiet surface) there exists a reasonable chance we'll see a strong advance-day for the overall market somewhere in this time frame. If so, I may reduce on strength sooner, in the final 30 minutes of that session.

There are some hurdles, as always, and if we stumble to any significant degree I'll adjust the game-plan and lighten sooner. Potential game-changers include 1.) the potential that the end of the quarter Tuesday will mark short-term highs in leadership stocks; 2.) the monthly employment report due Thursday [edited]; and 3.) anything else which may develop AND strikes a chord in the market.

A final thing I have to be wary of is the possibility of failed breakouts turning into selling routs. Several of my positions now are either breaking-out or poised for a breakout. I live for such problems, but with life in the fast lane eyes must keep alert. If break-outs like RAX and PAR stall and turn below break-out pivot points, I'll let them go ahead of schedule. If SNDA breaks to a new high now, I will look to sell right into it (since the too-far-too-fast advance means the likelihood it will need further consolidation); while if CYOU breaks-out I will try to hang-in for the ride until Friday or Monday (as this one is less mature, it remains a beast so far, and almost any upside is possible.

In other words, neither CYOU nor SNDA has a reasonable base to break-out of just now, yet the younger CYOU has a better chance for getting even more disgusting. I've done well earlier in selling-out at the right moment and then hopping back on for more after pulling back, but on this particular juncture, given the calendar, the general trend and the fact that it has no business now being back to new highs again after such a brief consolidation, why should I get logical and conservative when this name acts like it still wants to surprise?

I expect few entries again this week, while I'm exploring past and future Volcanoes and ultimately then heading out into the Mediterranean. My Twitter works well enough for broadcasting changes in my position, but even those may come late now as I will miss chunks of time (though not opens and closes) and I'll be dealing largely with limit and stop orders intraday.

I'm off.

Total Position: 100% long, 53% invested

Currently Long (according to size): CYOU (6.1%), ASIA (5.5%), RAX (5.4%), SNDA (4.9%), WFT (4.7%), TQNT (4.2%), ARST (4.2%), NFLX (4%), LFT (3.8%), MRVL (3.5%), PEET (3.5%), PAR (3.3%)

Currently Short (according to size): no current position

Futures Accounts: no current position

Night Gallery (Rome Bone)

Quick Bone from Rome

Keeping up as best I can posting, which has been zero this week. The connection at the hotel is unable to hold my trading programs open for more than 5 minutes at a time, so all efforts have been engaged with monitoring and trading; not commenting.

Anyway, I've so far kept the Twitter feed real-time, as that is quick and easy (lucky you).

My (Twitter) comment late yesterday after letting go all of my market hedge remains my push for now. That is that we saw a lower-volume market decline led by cyclicals, materials, golds, oils, steels (and whatnot) and that leadership yesterday had begun firming; suggesting the potential to now rally into the July 4th (US) holiday; the action in currency markets were another positive tell.

So far so good. If we fail, I may not be talking it up so much, but I will be scrambling somewhere, somehow, to get exposure reduced. Otherwise I am only letting go problems and attempting to hold-on and reduce into seasonal strength. I know that's cutting to the chase, leaving details as to why, how and what-if...but my time is measured more than words just now. I don't know anything more than I've said above anyway - I'm just following the market action and going with what I know (sans noise).

In the meantime I am stacking up quite a lot of Night Gallery material (Fems, Fiats and Fellini's). Few of you want to know about that, perhaps, but the photos are rich rich rich - like you would be if you had held on short!

Ciao ciao for now.

Total Position: 100% long, 45% invested

Currently Long (according to size): ASIA (5.4%), CYOU (5.1%), RAX (4.7%), SNDA (4.4%), TQNT (4.3%), NFLX (4%), ARST (3.9%), LFT (3.7%), MRVL (3.5%), PEET (3.5%), PAR (3%)

Currently Short (according to size): no current position

Futures Accounts: no current position

Vesuviusness (leaving the country for now)

Apologies for the lack of recent posts, but get used to it Señor Chase - I'm about to blow this coup.

Tomorrow I leave for the land of Ferrari's, Fellini's and Fems. This year's version of my annual Rest-and-Refresh, Rot-not and Reconnoiter; well-east of Wall Street's. I'll be in Rome on Monday and climbing into volcanoes by the weekend.

I will do my best to upload along the way - understand that lava may be dormant from time to time.

My accounts currently hold 10 longs (roughly 48% of portfolios).
Each hold a single hedge, TWM (13.6% of portfolio).

-I let go anything which became questionable (oils for now and a gold position).
-Aside from PEET, I'm left with Tech and Internet (which frankly is acting best).
-I have a tight stop (presently) placed for the TWM-hedge near 41.50 (this is indeed tight, but Friday began very strong, gave up more than half the gains and then finished reasonably well; I feel rather confident that should Monday start-off strong, the market will drive higher throughout the session. I'm not calling for a strong Monday (slightly doubting it at moment), but only that after Friday's pivot-up and then slowing-down some, we will not give it up a second time if the market opens more than a little upward; hence the tight stop on the bench.
-I have stops in mind for every long, but frankly most of these are going to count only in the last 90 minutes of trading. For ex., ASIA may see a slice downward, but I don't want an open stop anywhere close since it may indeed recover the same day. Most stops I have open at moment are far away in price - the real bench is tighter, but if I cannot witness it live I need to give them until the final 90 min or so trading; dependent on volume, price action, RS, etc.
-I let go the SRS as the real estate muck (IYR) began taking out highs late Friday. SRS is higher beta and if the IYR runs higher now Monday, SRS will normally see a 5-15% decline (I don't want this name if going down). If the market looks bad though, SRS with a simultaneous stop placed is an easy way for me to neutralize pressure; hence if the world is for sale in the premkt on Monday, I may put SRS back-on here before the open.

At the moment I still think leadership is acting well, while the market is acting so-so (although it is acting better than the current perception out there, imo).

On Friday, July 3rd and Monday 6th, I'm looking to go light (sooner if the environment returns tricky or difficult). This is as I mentioned before - unload into seasonal strength...then take some rest unless the market continues steadily and measurably upward. I arrive in France then on July 7th. If the market is refusing to let me rest, I'll be there for it. If it is typical, quiet July fare, I'll stick with the plan of resting-up for the second half.

Adventures will be posted - even if trading is light. Get outside!

Total Position: 3.17-to-1 net-long (plays ~2.25-1 net-long considering levered TWM), 57% invested

Currently Long (according to size): ASIA (6.1%), CYOU (5.1%), RAX (5%), SNDA (4.4%), ARST (4.3%), TQNT (4.1%), LFT (3.9%), MRVL (3.5%), PEET (3.5%), PAR (3.1%)

Currently Short (according to size): TWM-long (13.6%; Russell2k Dbl-short),
(Note: inverse-ETF TWM represents being dbl-short the Russell 2000)

Futures Accounts: no current position

Quicknote

Unable to post today. Outlook and strategy for short-term (outlined yesterday) remains intact. Trades and/or changes in allocation will continue to post live on my Twittspace.

...you need to get outside more.

Potential Pivot Point (and a brief game plan)

Still quite busy here, but here is a synopsis now of how I hope to play things for the short-term period. If the market does not cooperate I will have to adjust, obviously. But so far so good...

Today's reversal may create a nice short-term pivot-low.

If so, we may manage to trend higher up into the end of Q-2 and onto the July 4th holiday. That would then provide good seasonal-strength selling opportunities on the Friday-to-Monday; 3rd-to-6th of July.

If not, I'm going to have to lighten-up, using today's lows (in most cases) for benchmarks. In this case I would begin getting defensive and very small, until the market shows better.

I let go a lot of the increased hedge today and at moment am only holding 5.4% SRS for that purpose.

I was down more than the broad market yesterday, even with hedges, as the growth names took it much worse than indices. Volume though was not heavy, nothing really broke significant support, the entire world was expecting this pullback at the same time that the charts of leadership names still look like they should be bought. I couldn't really see anything too ugly yesterday, so I just upped the hedge instead of selling names.

Finally, unless the month of July is a clear trend higher, I'm looking to play it very light, decompress some and get rested for the second-half of the year. I don't want to work hard if the environment of summer is at all choppy; as I have found again and again that a choppy summer environment is both tricky and difficult to prosper Normally, as a result, it is the best time to rest and refresh. By later in August I find the environment to be typically more playable and then September to January is generally money-time, as far as my historical performance.

That last part suggests I'm getting ready for extra-curricular activities. Thus, even if my trading gets boring by the time we hit July 4th, the hunt-and-kill reports posted here will hopefully suffice your personal bloodthirsty appetite.

Total Position: >10-1 net-long (plays >5-1 net-long considering levered SRS), 58% invested

Currently Long (according to size): CYOU (increased today, 6.9%), ASIA (6.1%), RAX (4.7%), SWN (4.5%), WFT (4.3%), SNDA (4.3%), TQNT (4.3%), ARST (4.1%), LFT (3.8%), MRVL (3.5%), PEET (3.5%), PAR (3%), AU (2.9%), JDSU (2%)

Currently Short (according to size): SRS-long (5.4%; US Real Est. Dbl-short)
(Note: inverse-ETF SRS represents being dbl-short the US Real Estate index)

Futures Accounts: no current position

Quicknote on my position

In retrospect I should of held onto the larger-sized hedges yesterday, as we're seeing further selling pressure today. That said I'm not completely naked and I have mentioned I will error on the bull side as long as the leadership charts continue to look positive.

Volume is running low and breadth is not so severe today. I'm having trouble reducing the number of longs, which is what I expect to do when weakness continues, because on a case by case basis I cannot see compelling reasons to sell. Tomorrow is Obama's speech regarding new financial reforms or whatnot, which could turn out to be a turning point; we'll see.

I did increase the SRS-hedge and I may go back to upping the TWM-hedge if necessary later in the session; instead of reducing names. And I am happy (oh boy!) to sell any longs breaking down, showing accelerating selling pressure, etc.

Brings a smile, doesn't it?

Dial 1050 for Chump

Total Position: 4.43-to-1 net-long (plays 2.22-to-1 net-long considering levered TWM and SRS), 68% invested

Currently Long (according to size): ASIA (6%), SWN (reloaded today, 4.5%, WFT (4.5%), RAX (4.5%), CYOU (increased today, 4.4%), SNDA (increased today, 4.3%), TQNT (reloaded today, 4.3%), ARST (4.1%), LFT (3.7%), MRVL (3.5%), PEET (3.5%), AU (2.9%), PAR (2.9%), JDSU (2%)

Currently Short (according to size): TWM-long (7.0%; Russell2k Dbl-short), SRS-long (5.5%; US Real Est. Dbl-short)
(Note: inverse-ETFs TWM and SRS represent being dbl-short the respective indices)

Futures Accounts: no current position

Quicknote on Hedge, Wheel-O's and Cramer Dividends

I'm going to be a little busy this week, as such I'll be posting less. I will however continue to Spit-twitt new trades live.

We have something of a pullback, so I'll take a minute and explain how I am hedging for it. First, Friday ended much better here than it began, capped-off in the after-mkt by two lovely set-ups courtesy of Dr. Cramer. I got short HBAN up in the nethersphere (as high as 13.5% above the closing price) and I also got to unload my largest long, TQNT, also in the exosphere (6.325, greater than 9% above the closing price).

So while ravaged, bloody and bitten early Friday (somewhat), I got back to the cave with dignity and well, grace. More Kisses for Cramer. That guy that keeps on giving.

I just let go the Chinese hedge (FXP) and from here I will look to hold my (4) Chinese growth names (CYOU reloaded again today). If tomorrow is down further and there is no sign yet of a bid in the market, I'd prefer to reduce exposure and the number of longs, instead of re-loading another FXP-hedge.

I'm still holding TWM and SRS. Given the severe negative breadth on the day (volume however, is relatively low). I increased TWM intraday, but I expect to back-off the additional shares near the close (sooner if the market catches and keeps a bid). So while I'm closer to flat at the moment, in terms of exposure, I'll go into the night leaning around 3-1 net-long, depending.

If the market still lives, then by tomorrow we'll see something resembling strength. If we are ugly still tomorrow, I'll reduce exposure by shrinking the number of long positions (holding winners first); let the remaining hedges go then according to the action, exposure-long, etc.

And certainly, I don't mean to suggest that the market cannot begin trending downward now (I just need to see it and respond before giving up the easier job of buying leadership in a good market instead). Who can blame me for that?

In fact, my go-to voodoo guy is spinning perpendicular right now and that has me a little nervous (not kidding). The illustrated chart above comes from TX Tornado's post The Wheel. Apparently, price, time and areas of Da Vinci influence are are all in harmony (my description). (SPX 950 was tested on 6/5 at a time/price which was 90 degrees from the 3/6 square and previous resistance).

I don't know what any of that means. Frankly though, I don't need to. When the universe lines up its ducks and starts playing Wheel-O with the markets, I keep my guard up.

Let's see what transpires.

Total Position: 3-to-1 net-long (plays 1.5-to-1 net-long considering levered TWM and SRS), 66% invested

Currently Long (according to size): ASIA (increased today, 6.3%), SWN (reloaded today, 4.7%, WFT (reloaded today, 4.6%), RAX (4.3%), ARST (4.3%), LFT (3.9%), MRVL (3.6%), PEET (3.5%), CYOU (reloaded today, 3.1%), SNDA (2.9%), AU (2.9%), JDSU (2.1%)

Currently Short (according to size): TWM-long (13.7%; Russell2k Dbl-short), SRS-long (2.7%; US Real Est. Dbl-short)
(Note: inverse-ETFs TWM and SRS represent being dbl-short the respective indices)

Futures Accounts: no current position