Trade Anatomy Portfolio
+2.61% MTD | 34.06% YTD
2 long | 0 buys | 1 sell
Not much has changed over the last few weeks and as next week gets underway, I think we'll see more of the same....greater volatility than most have come accustomed to seeing. As I mentioned in prior posts, a helpful factor for judging the overall health of the market is the number of stocks passing momentum screens. Momentum screens can be new 52-wk high lists, 30 day new high lists, or even new 30 day low lists. When the new high lists continue to deteriorate with each attempted recovery, a warning sign should be going off inside your head telling you to take your foot off the gas and start pumping the brakes. As the current market environment unfolds, I've chosen to become more of an observer than a participant, essentially putting my car (portfolio) in park. It's quite possible that in a few weeks or months that it will be more opportune to participate, but that's all dependent upon the quality of setups coming forward.
We're officially down to two open positions, CCS and LGIH, both of which are homebuilders. For a second time, ACLS was in and out for a small loss.
On Friday, ACLS was sold from the portfolio at 3.25. Our initial entry was on 9/8/15 at 3.44 per share. Total loss on ACLS was -5.52% for a -.24% loss of our portfolio value. ACLS was removed on Friday because the price moved below the lows of the past few trading sessions. When current market conditions aren't helpful, you have a couple options if you continue to trade. Smaller positions based on risk % or tighter stops. In the case of ACLS, tighter stops were used to protect capital.
Click to enlarge image of current portfolio positions.
Currently there are 9 candidates in the watchlist. Several have continued higher while a few are starting to show minor cracks in their chart setups. As I mentioned at the top of this week's report, the portfolio is essentially in park. That doesn't mean to sit around twiddling our thumbs and stop looking for potential stock setups. It's simply means to be additionally critical of setups that you are willing to trade. Minor headwinds are manageable, but gale force winds will make it next to impossible to navigate a portfolio effectively. Below are a few names worth watching, and you can click to enlarge.