The S&P 500 topped out yesterday at 3,387.
That was just shy of the 3,393 high we hit in February, the day before we plunged 1,200 points (35%) over the next four weeks. HOPEFULLY we won't repeat that disaster but, just in case we do, we're beginning to cash in our positions and, today, we're going to once again roll up our hedges to help lock in our gains.
The market is up not 35% (that's what we dropped from) but 50% abover 2,200 and that's a pretty good run. According to our 5% Rule™, we should be expecting a 20% pullback (of the 1,100 gain) from 3,300 back to 3,080 as a weak retracement and a stronger pullback would give back 40% of the gains, to our Must Hold Line at 2,860. That would NOT be bearish if the Must Hold line does, in fact, hold – it will just feel that way.
Still, no point in riding out the dip if we don't have to so we're going to raise more CASH!!! and there are plenty of great stocks to buy, like WBA, INTC, BA and VIAC (see Tuesday's Report and yesterday's Live Trading Webinar) so we'll have somewhere to put that cash if the market doesn't crash but I'll feel a lot better heading into the Back to School Disaster with more CASH!!! in our portfolios.
Our Long-Term Portfolio Positions are up over 100% for the year and they are protected by our Short-Term Portfolio, which is up 315% for the year at $415,152. That's actually down about 100% as TSLA has once again spiked up on us but we think we can outlast the Tesla bulls – even as the stock hits $1,600 again today. It's time, once again, to make some adjustments as the Nasdaq tests 11,150 as well this morning:
- CANE – Just a simple bet on Sugar. I don't see any reason not to ride it out as it's breaking up nicely.
- AAPL – On track and we don't need the margin but we may as well buy it back and clear the slot.