Trading Update: 7 March 2015

True Profits Earned in 2015 to date: US$8,419.19

All-time maximum profit earned since 2011: US$144,512.84 (new high water mark!)

Current drawdown from all-time maximum true profit earned: US$3,392.77

Change from last update: Down US$1,127.27

Directional stance: Portfolio is 59.65% bullish

We were humming along nicely this week and new highs were made again at the start of this week. Until the markets decided the daily grind up is a bit boring and the S&P 500 threw a curveball last night to fall 29 points to close at 2071, after spending the majority of the past two weeks nicely nestled in the 2100+ region. Hence we incur losses this week. Well you have to respect the markets and enjoy a little action if the markets are up to it. What this means is the markets want to see a little correction, and last night's action may already have been all of that correction, if not we will see some more early next week. But already the divergences are building up to indicate a decent move up is going to happen after this little jaunt is over. 

While I am still looking for a target of 2200+ which is about 100 points of upside left, it isn't too much to be honest and this bull market will be coming to an end by probably in the next 3 to 6 months. What this means is I have to be prepared to put away my bull horns and start looking in the storeroom for where I put my bear paws. I think I last wore them in 2009. The strategies that have served me well in the past 2-3 years which I've had to tweak for the bull environment will need to be adjusted for the bear market.

Hey Mom, do you remember where I put my bear suit?

As we enter into the topping process, we can expect to see the market heave and ho to eke out a few more points for a new high, then correct, then heave and ho again to make marginal new highs, then correct. Rinse and repeat until all the bulls in the market have already joined the tug-of-war against the bears. When there is no fresh meat to join the bull team, the balance turns and the bears slowly will grow in numbers as more bears from the sidelines join Team Bear, and eventually the bears will outnumber the bulls. And then you put on the bear paws.

Are you Team Bull or Team Bear?