We’ve been playing a cautious game over the last few weeks not really placing too much faith in this renewed strength or bullish market chatter. Whilst we’re taking a few long positions we’re also keeping the risk very low at just 0.5% per trade. It was highlighted to subscribers that perhaps the start of the reporting season would induce some of that expected weakness so its of no surprise that the we’re seeing this weakness coming through. The question is how it will impact on the larger price patterns. If price dips on low volume and in a meandering fashion then we firmly believe that renewed strength will emerge within this bear market bounce. However, if reporting season sends a vortex of fear back into price then we must expect new lows will be the expected outcome. In other words we watch this decline with interest because it will in turn dictate what the next move will be and how we position ourselves.

The Model Account is still unwilling to get on with it. As stated above we have some longs on but unless this market can get some lift we’re going to be left dragging again. Whilst we’ve not made any head way for some time we also need to be aware that we’ve not lost our shirts in this volatility. As such we can be prepared for when the better times come along.

I’ll be taking 10-days break over the Easter period and will be closing down US positions.

Good trading,
Nick