Now that the holiday season has come to a close and the new year is in full swing, it's time to look forward to new opportunities. The last blog update was on Dec 20th, and in the update, I'd explained that all of the open positions, excluding LYTS, had been sold. The month of December was closed out for a -3.12% loss, but on whole for the year the portfolio was positive by +35.48%. LYTS was carried over into the new year, but was sold on January 4th at 11.69. With an entry near 10.59, the trade was good for a 10% gain.
Current 2016 Portfolio Summary
-.32 MTD | -.32 YTD
0 long | 0 buys | 1 sell
We are now 13 days into 2016 and so far it's come with a lot of fireworks. It's been the worst start to a new trading year ever! The last 13 days are simply a continuation of a technical pattern set in motion several months ago. Really since the middle of 2014, institutional money has slowly been concentrating their capital into a narrowing group of stocks. So much so, the term FANG (Facebook, Amazon, Netflix, Google) is now widely used when money managers discuss the current investment environment. A handful of stocks, however, can only act as a foundation for the market for so long before the weight becomes too much.
How many times this week have you read or heard from outside sources that this move down is overdone or the fundamentals are still intact? How many times this week have you read or heard the doomsday crowd calling for a total market crash? They act as all knowing when in reality they have no clue. That's why it's important to understand your trade setups and the price action necessary for you take a new trade. Let the "experts" discuss where the market should or will be in the next few months and save your mental energy while you wait patiently for new opportunities. Remember that as traders, we should be in the business of making money not prognosticating .
There are currently 15 candidates on the watchlist. Most however are moving ever closer to being removed from the list. The current screens are only producing 75 names which is making chart viewing and scrubbing a quick process. Below are 3 names still on the current watchlist.