QUICK THOUGHTS
I may not escape this pullback unscathed. My short-term trend indicator is a couple days away from turning to bearish. As you know, this completely contradicts my personal opinion about the direction of the markets. Personal opinion doesn't matter, however. My system of controlling risk is my system of controlling risk, taking precedent over all else.
If I do get a confirmed signal, I will move to 75% invested from the current 95% level. I will also initiate a hedge to cover the 75% invested position on a dollar for dollar basis.
As I have discussed previously, there have been numerous close calls in 2012, where both my short and intermediate term indicators have looked like they were going to flip and have remained bullish. I am hoping that this will be another close call.
By the looks of it, we are setting up for the perfect low on a time and price basis either tomorrow or Thursday. I continue to expect that to be the low for the month of September.
There have been slim pickings in terms of new small-cap investments. Once my trend indicators firm up a bit, I may put some money to work in KKD as a long-term play. I also have interest in YELP once again, if it moves into a favorable technical position. If you'll remember, I originally published research on YELP in April. I sold it for a loss sometime later. It is too erratic to make into a large position. However, I believe it will be long-term winner. Worth taking a small position in over the next few weeks.
This has been a good year up to this point. I plan on making it a great year in the months ahead. I don't see anything that can get in my way other than myself. I'll keep an eye on me.
