Waiting, Watching, Protecting my capital

I should have got a post out earlier because I have gotten tons of e-mails asking what I am doing here. In my last post I said if "we blow past support then I will wait it out" and that is what I am doing. I cut back the small positions I had to just trackers for now. We have no support and I am not going to fight the trend when the only thing we positive is some good looking pullback patterns in individual stocks. Stocks like XTXI and SD have really nice looking low volume pullbacks but they still have room to pullback and keep that pattern intact as 50 dma are still in downtrends.

I am going to try to get a post out tonight cutting down my list to only the best looking pullbacks and what I will be looking as indicators it is time to get aggressive. Oil is the primary indicator as of now. The $30 level is holding on USO, lets see if we get a test of the 52 week low. I will be watching for big spikes in volume on a minute chart to start making buys. The commodity price looks set to test the December low over the next day or two. I want to see that hold before I put much funds at risk. Another sector to keep your eye on is the Bulk Shippers. Money has flooded into that sector and then retroactively into other commodity plays as those start moving. Most of those stocks such as DRYS, GNK, EXM, TBSI are pulling back on light volume and they could be a leading indicator of which way other commodity stocks head. I am sure the bears have been licking their chops at the prospect of shorting 400%+ moves since the November low, in the case of DRYS. Whether this leads more and more to lock in gains or a further squeeze will be interesting. The dry bulk index has seemed to bottom after falling off a cliff for months. Lets see if it can maintain an uptrend.

Chart of Dry Bulk Index

But For now I think patience and capital preservation is the only prudent course of action.

JAX