Wednesday, May 12, 2010

Bookkeeping: Creeping Back into Stocks Jumping Back Over 50 Day Moving Average

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I am acting under the pretense that this 50 day moving average will be overwhelmed by the world's central bankers, along with the thought process I am still extremely highly exposed to cash so if I am wrong my exposure is not excessive. If the pattern of the past year or so holds true, the market will only go down on a human emotion news event, otherwise it can only grind up as computers "provide liquidity".

As stocks currently in the portfolio make it back over their respective 50 day moving averages I want to get back some exposure to them. At this point I am adding 1.2% exposure to both Wyndham Worldwide (WYN) and Riverbed Technology (RVBD) for identical reasons - seen in the charts. By entering here if for some reason the market tails off, we have stop loss areas right below and damage can be contained.



EDIT: I've added about 7% long exposure this week with purchases but still under 20%. If the S&P 500 closes over the 20 day moving average I'll look to become more aggressive on the long side as mentioned earlier in the week. Shorting remains only for the nimble and on an intraday basis unless human emotion is involved in a news event.

Long Wyndham Worldwide, Riverbed Technology in fund; no personal position

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