Fascinating session - I am enjoying this massive cash hoard as this action unfolds.
Last Thursday, we cut back E-House Holdings (EJ) by 60% as it triggered a stop loss in the $20.30s and broke support, under the 50 day moving average. This took us down from a 1.6% exposure to 0.6%. The chart looked like this on Thursday:
I am cutting most of the rest of the position here in the mid $19s as we now have a broken chart, we'll keep a 0.1% stake just to keep it on our radar. Chart now looks like this
At this point I would not really be interested in the name until it gets back over $21.50 ...or falls to its 200 day moving average down there below $15.
It is interesting to me to watch the indexes hold up, but I'm beginning to see some breakdowns in quite a few names. This coincides to the weakness in the Russell 2000 (a broader index) versus the larger indexes I've noticed the past week... in English, this tells me the rally is narrowing into fewer names. Those names happen to be large cap multinationals so they have outsized impact (especially on the Dow) but I noticed a breakdown in some of the major restaurants two weeks ago and now we're getting more widespread weakness in the small and mid cap stage. Our trading process is correctly taking us out of stocks 1 at a time as they break down...
Long E-House Holdings in fund; no personal position