POSITIONS: Long Healthcare (XLV) Long Consumer Discretionary (XLY), Short Industrials (XLI)
I came into today a lot longer than I am now. I sold by my SPY and AAPL as we push toward my Selling Zone.
Since Equity Volatility has moved back to bullish TRADE and TREND, I can change the duration and volume assumptions in my immediate-term TRADE calculation in order to generate a range of probabilities instead of a point.
In other words, there are 2 immediate-term TRADE lines (1315 and 1329), and that generates my Selling Zone. On the way up towards that zone I want to be selling longs first, then re-shorting best ideas, selectively.
Across risk management durations that matter most, here are my lines right now:
- Intermediate-term TREND resistance = 1369
- Immediate-term TRADE zone = 1
- Long-term TAIL support = 1282
We held my long-term TAIL of 1282, and that’s the most bullish thing I can tell you. But I am also telling you to sell down gross and/or net exposure on the way up. Unless we see a close > 1369, the intermediate-term view for Q2 remains bearish.
Keep moving out there,
Keith R. McCullough
Chief Executive Officer