Due to weakness yesterday and Apple’s after hours disappointing earnings release (down 12.5% today!), we moved our client accounts off margin early this morning. Since then, we took a wait and see approach to see if the market could stabilize throughout the day and unfortunately the market closed in a very weak position.
As a result we have moved more funds OUT of the market. Our clients are now 75% invested in the market (25% safely in cash).
What does this mean? … is the market going to tumble from here?
Probably not, but a cautious approach going forward is warranted. I don’t pretend for a moment to be able to predict the future of the market, but our data analysis has been showing a lot of selling in the background over the past few days and the market certainly seems to be struggling to continue higher. We have had a good run since the low in November (historically November, December and January are the best months of the year for the market) and although we certainly could continue up after a short rest, the Resnn model excels at taking a defensive posture, moving to cash quickly when weakness is prevalent thereby protecting our client portfolios from downward movements.
Time will tell how correct our signals are this go’round, but while we wait for that to happen, we will certainly have our client’s interests at the forefront, protecting their investment.
Please feel free to call or email with any questions or comments.
Resnn Investments, LLC