Interesting action today - very mixed bag. A lot of positives, but two yearly level rejections is just not bullish.
+s
DIA jumped above YR1, above all pivots
IWM above all pivots
XLF strong - nice to catch that from longs last week!
VIX below all pivots, XIV above all pivots
TLT and GLD weak - TLT below YP, JulP and testing Q3P; GLD all of a sudden below 2HP, Q3P and JulP.
-s
QQQ 2017 USA main index leader below Q2P and YR2 fail!
VTI YR1 fail
SPY JulP rejection
SMH below Q2P and already testing 2HP
Themes of the last 1-2 weeks continued today, with momentum trades QQQ and SMH getting hit while 2017 laggards USO, XLE, IWM and especially XLF all popping.
The only pain to portfolio today was the FXI hedges on EEM longs. Didn't see that coming. Holding these one more day due to DXY strength.
I saw potential weakness in GLD last week, but pro selling today in the pre-market and didn't chase the gap. This time would have paid to manually calculate the other pivots; as of Friday, only below monthly. Today, opened below Q3P and 2HP. At Friday's close, would have been below Q3P enough to trigger a short position.
Portfolio is 80% net long due to SMH short and 2 FXI short hedges. Ready to cut the SMH short which has been fantastic move for 1 week trade; we'll see if 2HP holds on Wednesday. USO will hold above the JulP and then see what happens at Q3P and 2HP above. SPY for the rest is OK but don't like the JulP rejection. There is a case to reduce 1 or 2 of these, but so far in 2017 any reduction without VIX & XIV confirmation has cost the next day. So, will skeptically hold. Also, I could swap out some of these for IWM longs, since SPY below JulP and IWM above. Don't quite like the setup with IWM pushing the daily BB but will keep this in mind.
My tune will change if VIX jumps above Q3P and DIA rejections YR1 again, but until that happens, staying mostly long.
SPY, DIA, QQQ, VTI, XLF, SMH, TLT, GLD below.
