6-28-2015 Comments

Friday's action encouraged me to take a 20% profit in PANW and further reduce portfolio exposure by selling NXPI which appeared to be not working. When I take a position near the 50-day I normally wait for it to fail the 50-day before shedding the position. I remain 86% long.

We have built up 7 days of distribution in the 25 day look back window, Friday added a day but also one day fell out of the window to keep the total the same. I am still monitoring the 120-day ema on the S&P 500 as the line in the sand as to where the market could be in trouble. We are 0.9% [U]above [/U]this level. With summer time light liquidity and Greece falling apart this level could easily be breached. In the past it makes sense to allow a penetration of this level over a 3-4 day period before making any definitive conclusions about where we are headed. Except for October 2014 we have bounced at the 120 day ema an astounding 15 out of 16 times looking back to December 2012 and the October 2014 penetration was rapidly recovered from in about a week.