*Blue Plate Specials* – 8/27/10

Market Notes
Broad market rally prevents major averages from violating major support levels. VIX dropping below 25 is bullish but low end-of-day Trin (< 0.6) could spell a lower open on Monday. Of course, anything can happen over the weekend so who knows what traders may be thinking on Monday, if they even bother to show up at all?

Today’s new portfolio
Despite today’s rally, the SPX is still trading well below its 40 dma which is our long/short criterion. Therefore, a short portfolio was entered using stocks selected from today’s New Lows list and the Breaking Down list featured on the *Blue Plate Specials*. The position size is adjusted according to currently total fund holdings which is down from inception. (Initial position size was $1000.)

Capture

Today’s portfolio close-out
Because no portfolios were initiated during my early August hiatus, there is no portfolio to close out today.  The next portfolio will be closed out on Sept. 8th.

[Construction rules for these portfolios are given in the 4/21/10 blog.]

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