Friday, February 12, 2016

Feb 12 - Closed SPY/ XIV longs...for now

I might be too cautious here but I closed XIV/ SPY longs as I am seeing some things I don't like.  On the good side, some assets like Treasury yields, junk bonds, etc are showing bounce but I don't like the price action and more importantly volume.  It isn't bad but it isn't where it should be if this is an intermediate term bottom.   I am guessing that we might be forming an intermediate term base but it is getting closer to being complete but not fully cooked.  I don't feel confident in a big edge long or short here for the very short term.  Maybe that will change at close but even then I probably will stay flat.

I could be paranoid here but when my checklist at critical junctures isn't complete I don't like stepping on board the rocket ship.  If I am wrong, there will be time to catch a seat.

The good part is yields are flying up.  That's good
 HYG (junk bonds) is seeing a good bounce and issuing a buy signal on daily although it could be easily undone.
 This is the part I don't like.  SPY volume is really really low today.  We might not even hit 125 MM shares traded today.  Not enthusiastic enough for me.  The second part is stochs haven't totally bottomed out which in my mind leaves a room for another flush out or two before things stabilize.  The third part is the intraday buying activity isn't resulting in a big candle.  I wanted to see relentless buying from open to close.
 Maybe a sell on the 30 min.
 VIX is stubbornly hanging around.  Again, still a little more room on stochs, CCI to become overbought.  I'd like to see them max out to feel more confident.

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May 15 - Closed out IWM puts for +120% and picked up DAL and HD Jun calls

I'm going to let the market do its thing this week and probably stay away from new positions until Friday unless something very good pop...