Portfolio Positioning

Weak Chinese export figures are depressing futures this morning. This will be a great test for the U.S. equity markets regarding the resilience and ability to hold the line. Here is our plan of attack for portfolio positioning.

1-      If we sell off aggressively on strong volume and close below the key level of support, then we will introduce hedging instruments in the portfolio to minimize any damage to the downside. The key area of support is 2120 on the SPX. The Nasdaq is sitting on its 50DMA and the Russell 2000 appears to have already broken near-term support.

2-      If we hold the line today, then we will keep our positions in place until the point where we get a large volume rally and breakout at least above 2150 on the SPX. At that point we will increase our long exposure.

Joseph S. Kalinowski, CFA

Email: joe@squaredconcept.net

Twitter: @jskalinowski

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