Things were looking shaky earlier this week so I sold my long position in the trading portfolio on Thursday.  That puts me at 100% cash in the trading portfolio.  There were no signals in the system that triggered this move, I just felt that we could see a sell signal fairly soon (days or weeks) so it would be best to take profits rather than hold a volatile fund.

I have been invested in QLD since last summer and made 48% on the trade.  (Trading portfolio is my mad money that I go long or short to make some extra coin.  Trades are usually held for 3 to 4 months max…infinity for day traders, I know.)  QLD is an exchange traded fund that attempts to move in the same direction as the Nazdaq 100, but at twice the pace.

If the system generates a sell signal, I’ll short using (QID) and/or an Inverse 2xNazdaq fund with the Rydex mutual fund family with trading funds.

A QUICK UPDATE ON THE SYSTEM:

Sentiment is showing a fairly high %-bulls and that is bearish for the market. The VIX and volume analysis are still bullish, but the signal is not strong so both of these indicators are neutral.  VIX and volume could give a sell signal if they continue to deteriorate.  All else being equal, if VIX and Volume give sell signals we’ll get a SELL signal overall and it will be time to sell stocks.  Remember, in a bear market, we could see a fall to the previous low; hopefully that won't happen, or if it does, we'll reach the old highs before the drop.

As of Friday, the indicators are in a HOLD position so I am still 100% long in retirement accounts.