Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio remains under a NEUTRAL condition, following a week of choppy price action. The overall market continued its choppy trading the previous week with neither the bulls or bears asserting any real directional power. The bottom line is that we remain trapped between the recent highs and lows of all the major market indexes during the past month. Our model will not move to either a BUY or SELL mode until this trading range is broken. The other possible model change could occur if the indexes make a powerful one day price move on higher volume. If that occurs and the indexes still remain range bound it is possible, if there are leading stocks in confirmation of the move, that we could switch before the trading range is resolved. If we were forced to make a bet on which way the market is going to break next, we would laugh in the face of someone suggesting such a preposterous notion. However, if we were asked to analyze the current situation of leading and other individual stocks in relationship to the pullback in the overall indexes, that would be a welcome logical request. When it comes to leading stocks in the market, based on EPS and RS ratings, everything is crawling along well. Our current holdings and leading stocks have done remotely well during the pullback in the market, with many of these stocks forming constructive consolidation patterns that historically should lead to further price breakouts. Some of our favorite examples include SCTY, TSLA, TNGO, DPZ, INVN, BLMN, SWHC, LNKD, and many others. These stocks are either consolidating nicely or are trending higher, despite the weak market. This, in our analysis, is a positive sign for a possible resolution higher. This being said, nothing is concrete and for all we know the market might break out to new highs to just reverse lower on huge volume. The point is that anything can happen in the stock market and if you are not ready for anything and everything, then at some point you will be caught off guard and pay the price. We shall see what the upcoming week has in store for all of us traders. As it stands, we continue to be very neutral here ready for anything to happen. Once again, based on our current holdings and leading stocks, we should expect a resolution higher. In reality, however, remember, anything can happen and everything must be prepared for. Have a wonderful rest of your weekend. Aloha from a very beautiful, warm, and sunny west side of Maui. Aloha!! Top Current Holdings – Percent Return Since Signal Date – Date of Signal RVLT long – 162% – 3/26/13 EAC long – 156% – 12/17/12 CAMP long – 136% – 4/26/12 POWR long – 135% – 12/11/12 CSU long – 106% – 9/4/12 FLT long – 97% – 9/6/12 HEES long – 86% – 9/4/12 ASTM short – 73% – 7/17/12 INSM long – 68% – 4/19/13 WAGE long – 63% – 1/8/13 ADUS long – 59% – 4/22/13 CHUY long – 55% – 1/10/13 SBGI long – 50% – 3/22/13 WDC long – 45% – 1/9/13 V long – 41% – 8/31/12 GMCR long – 39% – 4/23/13 BBSI long – 38% – 2/13/13 TECUA long – 36% – 2/5/13 GLL long – 27% – 2/14/13 PFBI long – 26% – 11/19/12 DDD long – 25% – 4/30/13

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio remains under a NEUTRAL condition but did see the model switch to a cosmetic-SELL mode on Wednesday only to be flipped right back to NEUTRAL on Friday. This quick flip-flip was not shocking on a discretionary basis as the signal triggered with only the NYSE under the 50 day moving average. On top of that, as we have constantly warned, since 2011, SELL signals are going to have to be confirmed in all indexes, ETFs, inverse-ETFs, inverse-leveraged-ETFs, and with leading stocks breaking down, before any SELL signal is actionable on a position taking basis. QE, ZIRP, and POMO makes taking SELL signals nearly impossible and it is not anything we will be interested in seeing until we see a real parabolic/climax conclusion to all of this economy propping. Despite the fake signal, it was an overall decent week. The bad news is that our early hedges that were doing nicely hedging our longs by Wednesday left us with mostly losses by Friday. However, what turned out to be great news for us, on the flip side, we did not produce one single full sell signal on Wednesday, when our model did a false switch. The fact that the market cracked and we had zero sell signals in our long holdings was a hint that the market was stronger than the tape was letting on. On top of that, what turned out to be the worst missed trade on our end since 2011, we saw an extremely high quality long signal producing in what is currently a non-CANSLIM stock (it will be shortly in the upcoming quarters). That stock was TTS. The signal it produced that day would be considered an 8.5 out of 10 using our internal criteria and that is an extremely high rating on a new long signal (obviously 9s and especially 10s are very very rare). Unfortunately for me and my portfolios, we have never received such a beautiful signal on a day where we switched to a SELL mode. This has never happened. I began trading my trading career in 1996, went full-time in 1998, and from these moments have never seen such a signal on a day of a SELL signal. So what to do? Well, since I didn’t consider it “perfect” (a 9.5 or 10 out of 10) I decided to pass and let the model take control. That was a big big mistake as TTS has rocketed higher 13% in the two days following this lovely signal. On top of that, the SELL is now NEUTRAL. Lesson learned. What was the lessen? Well from now on I know that when the market is trending above the 50 day moving average on all of the most important major market indexes, we have many long positions holding up well in our current portfolios, we have many stocks still setting up in strong bases, we have very few stocks breaking down hard in my short scans, and we get a near-perfect high-quality long signal on a day when we do switch to a SELL we take the trade. Now, I have to watch TTS do what it is going to do and “hope” that it produces some sort of follow-up signal to try to get me long this wonderful pattern. We shall see if I get a second chance. I will not be holding my breath, however. Still, it was a very important lesson learned and goes to show that even with almost 20 years of full-time stock market experience you can still teach an old dog new tricks. Well played Mr. Stock Market. Well played. Big Wave Trading never needs to learn a lesson the hard way twice. Have a great upcoming rest of the week everyone. It’s been a nice weekend, despite the TTS missed trade on our end. Truth be told, I am more upset that the season finale of Game of Thrones is tonight than I am I missed that trade. As far as I am concerned, Game of Thrones, should never end and never go on break. Just keep the camera rolling and George R.R. Martin writing. Aloha!! Top Current Holdings – Percent Return Since Signal Date – Signal Date EAC long – 228% – 12/17/12 HIMX long – 185% – 12/19/12 CAMP long – 132% – 4/26/12 POWR long – 125% – 12/11/12 RVLT long – 114% – 3/26/13 CSU long – 107% – 9/4/12 FLT long – 95% – 9/6/12 HEES long – 82% – 9/4/12 ASTM short – 72% – 7/17/12 INSM long – 72% – 4/19/13 GNMK long – 71% – 11/16/12 WAGE long – 64% – 1/8/13 WDC long – 46% – 1/9/13 BBSI long – 45% – 2/13/13 ADUS long – 41% – 4/22/13 V long – 40% – 8/31/12 CHUY long – 40% – 1/10/13 SBGI long – 39% – 3/22/13 GMCR long – 35% – 4/23/13 TECUA long – 31% – 2/5/13 GLL long – 31% – 2/14/13 AMWD long – 30% – 2/1/13

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio remains under a BUY condition, despite the harsh sell off this past Wednesday. During such a strong uptrend with the averages constantly riding the 5, 10, 20, and 50 day moving averages higher, it will take more than a one day sell off event to switch our model. The only time a one day sell off would switch the model from BUY to NEUTRAL, in such a strong uptrend, would be if that sell off resulted in a loss of the 10, 20, and/or 50 day moving average on extremely strong volume. Since that was not the case on Wednesday, we remain under a BUY condition. The price action that has followed this session has been very constructive in all major market indexes and leading stocks appear to have weathered the sell off very well so far. For now, this is strong confirmation that the uptrend is still solid. We do understand that this could easily change very shortly if further selling does appear. However, skilled market operators understand that you can not make money on “what-if” scenarios. So for now, the trend remains up and we will continue to hunt for new long positions as signals arise. The intraday price action of Thursday and Friday was very constructive following the sell off, with the market opening lower and closing higher near the highs of the day on both sessions. This action, along with the lack of stocks breaking down in my short scans, is indicative of a market that wants to still move higher here. Another positive sign, for those long in the uptrend, is that very few holdings gave partial sell or full sell signals the past three market sessions. In fact, on Wednesday there was only one full sell, following that big sell off. So overall there remains very few real factual based reasons to turn fully bearish here. Have we started to hedge our positions? Yes. But only in a very minor manner. That being said, if we do reverse lower here, we are ready to increase our hedges and will take action on all sell signals that will generate on a pullback in the overall market. While we are indeed ready to increase our hedges, get short, and pair down our winners, we will wait for the market to tell us to do this. Right now, we want to be like water in a river. Smoothly flowing with the market in whatever direction it decides to go. Have a continued wonderful long weekend everyone. I wish you the best in the upcoming week. Aloha!

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio remains under a BUY signal and currently has zero issues weighing on it presently. On the short-term the market is very extended in price compared to trailing key moving averages. Logic dictates that a natural pullback to some form of support levels (fibonacci, price lows, or a moving average) should occur on the short-term. However, when dealing with our current reality we know that we could easily melt-up further in this QE environment before a logical pullback does occur. With the current uptrend the way it is–where volume is not part of the equation in our analysis–price will continue to be our sole signal generator. During the past week, we did see the Nasdaq suffer what appears to be on the surface a second churning session. However, following this churning session, the Nasdaq subsequently went to new highs. Therefore, for now it is only a surface scratch. For those sessions to have any weighing in the overall model we will have to see further distribution days that then lead price below these two sessions. Until that occurs, we will continue to stay the course. There were no major developments this week in our personal stock holdings, other than the fact that we have not generated any new long signals the past three market sessions. We believe this might possibly indicate that the market is too extended on the short-term. In saying this, it would not shock us if we got new long signals on Monday. Our current holdings continue to look very solid and we see plenty of stocks setting up in very strong consolidation patterns (ie…INVN) that could easily be another launching pad for another leg higher in this overall market. The surf continues to be absolutely huge in my backyard home break and I am going to go out and enjoy myself until I get beat up too much or get stung one too many times by all of the man-of-wars that are out there. I look like I have been hit by lightning at this point. Have a great profitable upcoming week. Aloha. Top Current Holdings – Percent Gain Since Signal – Date of Signal EAC long – 243% – 12/17/12 HIMX long – 216% – 12/19/12 RVLT long – 134% – 3/26/13 CAMP long – 118% – 4/26/12 CSU long – 114% – 9/4/12 POWR long – 109% – 12/11/12 HEES long – 86% – 9/4/12 FLT long – 84% – 9/6/12 WAGE long – 75% – 1/8/13 GNMK long – 74% – 11/16/12 ASTM short – 71% – 7/17/12 SBGI long – 47% – 3/22/13 BBSI long – 47% – 2/13/13 INSM long – 45% – 4/19/13 V long – 43% – 8/31/12 GMCR long – 41% – 4/23/13

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolios remain under a full BUY condition as we head into the upcoming week. There are currently zero items weighing on the model currently and it is not our job to try to guess when and if there will be any in the future. The trend continues to be higher highs and higher lows and until this changes there is no reason to try to top-call this market. What are our concerns? We are concerned about the non-stop uptrend off the November lows without a 5% pull back. We are concerned about the non-stop uptrend from the 2011 lows without a 20% pull back. We are concerned about the lack of volume in the overall major market indexes as we continue to hit new all-time highs. We are concerned that none of our new longs are exploding out of the gate immediately producing the past gains they used to produce under these exact same previous conditions. However, these are just concerns and are not actionable problems. When the index finally starts to change character, our new longs fail in succession repeatedly, we start to see churning and distribution in the overall market indexes, our current holdings start triggering profit taking signals across the board, we start to see leading stocks fail late-stage breakouts, and we start to see actionable short signals then we can start taking all of our concerns seriously. Until then, the trend is up, the market is hitting new highs, and our new long positions continue to make money immediately following a signal. As long as all of that is occurring there is nothing to do but ride the trend higher. I mean, the mere fact every intelligent market analyst and every intelligent macro trader in wall street thinks stocks should have topped by now or should top sooner, makes me believe the contrary approach is the right approach on the short-term. As long as we continue to see top callers, the uptrend has the sentiment it needs to continue to move higher. When these talking heads flip and finally capitulate to the long side then we can start to seriously consider the contrarian position of looking for a top when the smart folks are speaking of bullish matters. Great luck this upcoming week. We shall see if more highs or in store for us. Aloha from a very windy west side of Maui. TOP CURRENT HOLDINGS – PERCENT RETURN – DATE OF SIGNAL EAC long – 191% – 12/17/12 HIMX long – 164% – 12/19/12 POWR long – 118% – 12/11/12 CAMP long – 118% – 4/26/12 CSU long – 112% – 9/4/12 FLT long – 82% – 9/6/12 RVLT long – 82% – 3/26/13 HEES long – 79% – 9/4/12 GNMK long – 70% – 11/16/12 ASTM short – 69% – 7/17/12 WAGE long – 65% – 1/8/13 SBGI long – 55% – 3/22/13 BBSI long – 40% – 2/13/13 V long – 38% – 9/6/12 GMCR long – 37% – 4/23/13 WDC long – 33% – 1/9/12 PFBI long – 32% – 11/19/12 MNTX long – 30% – 1/17/13 HTA long – 29% – 1/2/13 AMWD long – 26% – 2/1/13

Big Wave Trading Portfolio Update And Top Current Holdings

Due to the distribution this week in all of the major market indexes, the breakdowns in leading stocks, and constant lagging in the Russell 2000, the market direction model has switched to NEUTRAL on all major market indexes. The short-term current market environment has gotten choppy over the past few weeks and this action is definitely weighing on the model. The lagging Relative Strength of the Nasdaq and Russell 2000 has made this rally all year long suspect but our individual long signals continued to work relatively well despite this. This is more of a byproduct of our long signals coming from big-cap big-board indexes. However, the overall lagging action of the Nasdaq and Russell 2000 was always a cause for concern. It should not be assumed that since we are now under a NEUTRAL condition that the very next signal is going to be a switch to a SELL mode. While it does appear the market is finally ready for a correction based on the way stocks are acting post-earnings, there are still plenty of leading stocks that are clearly forming decent consolidation patterns. A market reversal back to new highs would have many of these stocks easily breaking out of their current consolidation pattern. Therefore, it is best to remain very neutral here and wait to see which way the market breaks out of this consolidation zone the Nasdaq, Russell 2000, and SP 500 are in before convicting oneself to one side or the other of this market. We will continue to play individual stocks as they produce signals in either direction, keeping capital very limited in our selections during this bifurcated US economy and stock market. As long as the market rallies overall on low volume, it is going to be very hard to go 5%, 10%, and science forbid 20% long on a new long or short signal. We will just have to keep taking what the market gives us, either concentrating heavily into the best leading stocks in leading industry groups like Biotechs or keeping individual plays at a minimum with tight stops. The most important play for us right now is to continue to have a lot of cash on hand in case we get a screaming signal to the short side signaling that this market is done on the upside. The other scenario is having a lot of cash on hand in case the market breaks out higher and we get our once-reliable extremely strong price/volume signal to get heavily long a handful of leading stocks. While the latter scenario seems quite implausible it is still a possibility. However, truth be told, we are really waiting to hammer this market on the short side once it becomes apparent the QE low volume stock market manipulation rally is coming to an end. We might still be three years away from that though. Until then, we will ride the bucking bronco. Have a wonderful and profitable upcoming week everyone. Try not to psychoanalyze everything out there too much. Aloha! Top Current Holdings – Percent Gain – Date of Signal EAC long – 154% – 12/17/12 HIMX long – 130% – 12/19/12 CSU long – 96% – 9/4/12 POWR long – 87% – 12/11/12 CAMP long – 69% – 4/26/12 GNMK long – 69% – 11/16/12 FLT long – 65% – 9/6/12 ASTM short – 64% – 7/17/12 HEES long – 58% – 9/4/12 SBGI long – 41% – 3/22/13 WAGE long – 38% – 1/8/13 CPSS long – 35% – 1/31/13 BBSI long – 34% – 2/13/13 PFBI long – 29% – 11/19/12 AXLL long – 28% – 1/4/13 GLL long – 28% – 2/14/13 V long – 27% – 8/31/12 CHUY long – 25% – 1/10/13

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading portfolio remains under a BUY signal which was regenerated on March 5th. The Russell 2000 was the only index under a NEUTRAL condition heading into the most recent week but has now re-switched back to a BUY mode as well. Overall, following this week’s action, the uptrend remains in tact and there are no current pressures on the BUY signal. The only problem remains the same problem we have had for four years. There is still a lack of volume conviction in the overall stock market indexes on days when we rally. If there was broad volume across the board, Big Wave Trading would be heavily on margin during an uptrend like we are witnessing. However, without total confirmation across the board BWT continues to operate from a side of caution on new signals as severe sharp corrections are normal in low volume rally market environments. That being said, there continues to be a plethora of actionable buy signals across various investing methodologies and as long as signals are triggered on an individual stock by stock basis we will continue to go long our signals as they are generated. The only difference from this rally and all other previous rallies pre-2009 is the size of new long commitments. We continue to invest below what we would consider normal size per each new long signal. Going forward, we will continue to hunt and take action on our long signals and will constantly be vigilant and prepared for a significant correction. As long as the world is printing and commodities are falling, we do not have to worry about inflation or hyper-inflation influencing our dollar’s purchasing power. As long as world-wide QE and ZIRP is in effect, we will continue to focus on price only. Price is all that matter right now and we will continue to keep it simple. Have a great and profitable upcoming week in the stock market, everyone. Aloha from a very beautiful and warm Maui. Top Current Holdings – Percent Gain – Date of Signal HIMX long – 145% – 12/19/12 EAC long – 139% – 12/17/12 CSU long – 106% – 9/4/12 POWR long – 93% – 12/11/12 FLT long – 73% – 9/6/12 CAMP long – 73% – 4/26/12 HEES long – 67% – 9/4/12 ASTM short – 63% – 7/17/12 GNMK long – 60% – 11/16/12 SBGI long – 51% – 3/22/13 CPSS long – 43% – 1/31/13 WAGE long – 36% – 1/8/13 AXLL long – 35% – 1/4/13 BBSI long – 32% – 2/13/13