Last week I posted that I was in over 80% cash and looking for a pullback.  My stocks were not doing that great and my options were terrible…  That was last week.  Now, this week, before the market opens, things don’t look much better.  Stocks down.  Options down worse.  ETF/ETP down…  The cash isn’t down but cash is a place holder.  It doesn’t go up.  Not looking good here.  So what to do?

The 24/7 Stock Market News outlets are telling me that the Asian and European markets are down and US Futures indicate a lower open.  Glad about my cash position here but not so happy about the other holdings.   My ETF/ETP is VXX so it could benefit from some fear in the market.  That is why I bought in.  Problem is, I bought early (around $20) so I am down in the position for now…

So what to do?  Look at what the market is telling us.  Not what we want it to…

Long term trend to me is a year or years.  It looks to be up with periodic pullbacks.  Medium term trend is months to quarters and it looks to be at the end of an uptrend.  Short term trend is a week or so, maybe days and hours.  Bouncing in a range here.  This “short term” is where the 24/7 business news is reporting “the new new thing”.  News flash every time something changes.  Important if you are a day trader but not so much if you are holding stocks for longer periods than days…  Fun to watch when you have time.

So I can’t predict the future but I have to take a position…

Staying in cash with shopping list in hand.  This may be a week to start to deploy some of that cash.  Buying on pullbacks.  I have my shopping list.  May need to sell my stocks to limit losses.  Bought the BYD and HOV as plays on improving sentiment.  So far no luck there at this point.  May need to limit losses.  VXX is the opposite.  It usually goes up when things look bad.  So if my stocks go up, VXX should go down.  May need to cut losses here, depending on the way things go.  The F Call options that expire in the fall.  They really swing wildly and although I am down big, that can change fast.  I am still holding them as they are small speculative positions. The problem with stock options is that they can expire worthless.  So need to be careful…

That is the way it looks before the bell.  It will all change soon enough.  So we have to be ready.  Now, I have to get to work at my day job.  Moonlighting is fun but work has to be the priority…

Originally Posted on April 23, 2012   (Before System Upgrade)