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 Directional Model has switched from a BUY signal to a NEUTRAL signal, following the final hour of action during Friday’s stock market session. The vicious sell off on Friday, combined with the churning and distribution days adding up this month, is more than enough evidence that it is time to be fluid and ready for a move in any direction in the overall market. Longer-term there is a lot of support in the overall market that could easily lead us to further upside price. However, on the short-term we are indeed extended on all major market averages in relation to the 200 day moving average. The Nasdaq and Russell 2000 also remain a bit extended from their respective 50 day moving averages. Therefore, a pull back here is not a surprise and is in fact welcomed if we want to continue with higher prices in a more measured and somewhat safe manner. What will be more important to watch from here on out is how the major indexes will act around these key averages. Support at these key areas, along with high quality stocks showing Relative Strength to the overall market, would be indicative of a market that wants to continue higher over the intermediate term. If, instead, the market decides to find some support, begin to bounce, and then rolls over below the 50 day moving averages on the indexes, then we can start to prepare for some form of correction. Right now, most of our long positions (you can see 75% of our current holdings below as 3/4 of our portfolio holdings are up 25%+ per trade), are riding their key moving average lines higher and if they start to break below we will continue to take profits, cut our losses, and add to our hedges. Right now, since we are heavily long, we have been building a hedge in case the market does decide to correct harshly over the next couple of weeks. If the market decides to move lower, we will continue to pair back our long positions and add to our hedges. If the market decides to roll over and enter a prolonged downtrend, we will be ready via our market direction model and we will go short stocks that produce short signals accordingly. For now, it is best to be ready for anything. Emotions are very strong for those in the bull and bear camp. That can cause some extreme short-term price movements, as we saw in the final hour on Friday. Therefore, the best plan is to have a plan for every outcome. We do this on a daily basis at Big Wave Trading and that is why you will find very little to zero emotions involved in our methodologies. It is all about price signals. It is never about opinions or emotions. The only good opinion is no opinion, in the stock market. Have a great weekend everyone. It looks like our summer shores are in store for another large swell. Good news for me. Once again, have a great weekend. Aloha!!! Top Current Holdings – Percent Return – Signal Date EAC long – 204% – 12/17/12 HIMX long – 201% – 12/19/12 CAMP long – 134% – 4/26/12 RVLT long – 128% – 3/26/13 CSU long – 112% – 9/4/12 POWR long – 108% – 12/11/12 FLT long – 95% – 9/6/12 HEES long – 86% – 9/4/12 INSM long – 79% – 4/19/13 ASTM short – 71% – 7/17/12 GNMK long – 71% – 11/16/12 WAGE long – 60% – 1/8/13 SBGI long – 48% – 3/22/13 ADUS long – 45% – 4/22/13 WDC long – 44% – 1/9/13 CHUY long – 39% – 1/10/13 V long – 38% – 8/31/12 BBSI long – 38% – 3/22/13 PFBI long – 31% – 11/19/12 GMCR long – 30% – 4/23/13 GLL long – 30% – 2/14/13 AMWD long – 28% – 2/1/13 DDD long – 26% – 4/30/13

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

The Big Wave Trading Portfolio is back under a full BUY signal across the board as all major market indexes are hitting new 52-week highs with the SP-500 hitting new all-time highs. The model was in a NEUTRAL pattern coming into the week but on 4/29 the Nasdaq and SP500 switched to a BUY mode with new highs in their respective indexes hit. Following the switch in those two markets, the Russell 2000 and DJIA switched to BUY on 5/3. Overall, it is clear skies in the general market and the distribution day count has been dropped on our end with the market in new 52-week high ground. The good news is that volume was average to above average on the Nasdaq and Russell 2000 which gives us a decent confirmation on the price overall price action. While it would be lovely to see volume well above average on this rally to new highs, we are quite pleased to actually see average volume on the recent move higher. Unfortunately, this surge in volume would have been much preferred in November when the rally started but getting average to above average volume is quite nice considering all the previous low volume rallies we have had to be a part of the past four years. The lower volume rallies would not be a terrible problem if it was not being preceded by heavier volume selloffs. This makes for quite an odd Accumulation/Distribution ratio/rating in regards to the overall indexes. This is why we continue to stress paying attention to leading stocks and their volume only, ignoring the volume in the overall market, during this QE/ZIRP twilight zone market cycle. As long as stocks continue to breakout on volume out of sound consolidation patterns, we will continue to go long our signals as they are produced. Have a wonderful and profitable upcoming week. Aloha from an overcast yet still very warm and cozy Maui. Top Current Holdings – Percent Return – Date of Signal HIMX long – 173% – 12/19/12 EAC long – 141% – 12/17/12 RVLT long – 120% – 3/26/13 CAMP long – 111% – 4/26/12 POWR long – 110% – 12/11/12 CSU long – 108% – 9/4/12 FLT long – 80% – 9/6/12 GNMK long – 72% – 11/16/12 ASTM short – 71% – 7/17/12 HEES long – 69% – 9/4/12 SBGI long – 49% – 3/22/13 WAGE long – 46% – 1/8/13 V long – 40% – 8/31/12 PFBI long – 32% – 11/19/12 CHUY long – 31% – 1/10/13 WDC long – 31% – 1/9/13 BBSI long – 30% – 2/13/13 MNTX long – 29% – 1/17/13 HTA long – 27% – 1/2/13 AMWD long – 25% – 2/1/13 VIPS long – 25% – 3/14/13

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio remains under a NEUTRAL condition, following this week’s action. While the price action was very strong with many stocks producing large moves, the overall indexes are still trapped in a trading range between their respective recent 1-month highs and lows. While a resolution to the upside does appear to be imminent and all but certain based on the action of stocks, it is still not guaranteed. There fore, the situation remains fluid and the next switch in the model will occur once prices either breakout or breakdown out of the current consolidation range. Overall, despite all the noise that has been flying around the market lately, the trend still remains up in this QE environment. As long as we are in a world where central banks can print their way out of short-term problems, we must respect that any selloff will be contained and supported. Until interest rates begin to rise or the Fed hints that they are about to rise, we must assume that a real floor (ie…reality) will not be found. There is a major bifurcation between economic reality on the ground and the economic reality of the stock market. There has never been this much of a divergence between macro and micro in the history of US markets and I think it is about as clear as an example that you can have in regards to the USA becoming a serfdom where 3% of the haves control the 97% of the have-nots. So as long as this is the reality we are in, it is the reality we must deal with. Low volume rallies, low volume support, and new highs on low volume following heavy and constant distribution will continue to be the norm. It is not historically what market historians are used to dealing with but we have never had a global economy where every nation basically moves in lock-step ever before. The bottom line is that it is what it is. It would be extremely nice to go back to the way it was before 2009. However, that is wishful thinking and does nothing for our bottom line. What does help the bottom line? A disciplined, no-emotion, back-tested approach to price action. As you can see below, we are dealing with the market quite nicely. What is unfortunate is that these positions are not there usual 10-20% each across the board in the BWT portfolios. However, when you have a market where price and volume metrics that you have used your entire career continues to not work, you have to trade according to your risk tolerance. In this kind of out-of-sync price/volume environment, I don’t mind keeping positions smaller and more diversified. It continues to be too risky to get heavily invested in any one signal as we were constantly before the 2009 rally. It is what it is. It isn’t bad. It isn’t good. It just is. Have a great upcoming week everyone. Great luck in your personal investing/trading. Aloha from the beautiful island of Maui. Top Current Holdings – Percent Gain – Date of Signal EAC long – 141% – 12/17/12 HIMX long – 123% – 12/19/12 POWR long – 114% – 12/11/12 RVLT long – 113% – 3/26/13 CSU long – 96% – 9/4/12 CAMP long – 90% – 4/26/12 GNMK long – 73% – 11/16/12 FLT long – 69% – 9/6/12 ASTM short – 65% – 7/17/12 HEES long – 63% – 9/4/12 SBGI long – 51% – 3/22/13 WAGE long – 45% – 1/8/13 V long – 30% – 8/31/12 CHUY long – 30% – 1/10/13 INSM long – 28% – 4/19/13 BBSI long – 28% – 2/13/13 AXLL long – 28% – 1/4/13 PFBI long – 28% – 11/19/12 HTA long – 25% – 1/2/13 CPSS long – 25% – 1/31/13

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

Big Wave Trading Portfolio Update and Top Current Holdings

The Big Wave Trading Portfolio remains under a BUY signal re-triggered on 3/5/13 following the original signal on 1/2/13. There are currently zero conditions weighing on the model, despite the below average volume. Any assumptions and presumptions we have towards the current volume on the rally have been eliminated due to the QE and ZIRP policy being initiated by the Federal Reserve. We continue to go long signals as they arise and will not try to guess when the market will “top” or “pull back.” At this point the only signal that we are paying attention to is price. Price is the only thing that matters, as we have been saying all year long. Volume has not mattered on rallies in four years and there is no reason to believe it will matter any time soon. While it would be nice to see the market pullback for more than a couple of weeks on below average volume and then rally on higher volume it should not be expected. What seems most plausible given the situation that is occurring world wide is that we will end up in another asset bubble where higher valuation multiples are placed on stocks. Despite the lower earnings growth expectations investors are still paying higher prices for stocks believing that the Federal Reserve has eliminated the tail ends of the curve. As all experienced traders know this will eventually end badly. However, that is not happening yet and the only thing we can do is ride the trend until the end when it will bend. If another asset bubble is to occur we are in great position to profit handsomely and then will be in a better position to sell our winners as they break below key trailing moving averages on heavy volume. If the market can get parabolic that will allow us better entries on the short side (puts). For now, there is nothing to do but continue to follow price. As you can see below, following a very choppy 2011 and 2012, it is finally paying off like it normally has for us at Big Wave Trading. Someone asked recently that if the stocks below are our top holdings (top 50%) what are our our worst holdings. We currently have two. Both are automobile related equities and both are showing less than a 1% loss apiece. We do not hold losing positions at Big Wave Trading. Before any order is given to our brokers we know where we will exit if we are wrong. We religiously obey our final exits. We never let a loss run and are quick to leave if we are not proven correct immediately. As we go through equity/derivative drawdowns like we did in 2011 and 2012 we reduce the size of our positions and are quicker to cut losses. As our equity/derivative profit/loss line trends higher we will subsequently increase size and allow more “wiggle” room in our trades. The bottom line is that losses are never tolerated. They are always eliminated. No excuses. Have a great rest of your long holiday weekend everyone. Aloha from a very, yet again, windy and overcast Maui. Top Current Holdings – Percent Gain – Signal Date HIMX long – 127% gain – 12/19/13 CSU long – 113% gain – 9/4/12 EAC long – 98% – 12/17/12 POWR long – 96% – 12/11/12 CAMP long – 95% – 4/26/12 FLT long – 72% – 9/6/12 CPSS long – 70% – 1/31/13 HEES long – 70% – 9/4/12 ASTM short – 64% – 7/17/12 GNMK long – 48% – 11/16/12 AXLL long – 46% – 1/4/13 MNTX long – 43% – 1/17/13 WAGE long – 38% – 1/8/13 V long – 32% – 8/31/12 CHUY long – 30% – 1/10/13

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio remains under a BUY signal, as the market consolidated recent gains the past week. Volume was lower overall for the week and that is always bullish for a continuation of a trend. Unfortunately, when the market rallies it rallies on below average volume. The good news the past week was the selling volume was also below average. This action the past week has helped form a lot of solid consolidation patterns out there and two stocks that are on watch from the 3D printing arena include DDD and SSYS. If the market decides to move higher those two stocks will definitely be closely followed. On top of that, there are plenty of other stocks forming constructive weekly consolidation patterns. If the market breaks out to new highs here, expect these stocks to follow. Another positive for the market was the inability to really sell off following the Cyprus and Eurozone news all week long. The fact the market held up so well, despite this development, is a testament to the power of worldwide QE. When the market does not sell off on bad news, that is always a short-term bullish development. The other side, of course, is that a market that sells off on good news is a market flashing that it is in trouble. So, so far, so good. As long as leading stocks continue to do well and trend higher there is nothing to do but to follow the trend until it ends. While we are long a lot of stocks doing very well, we have our trailing moving averages to tell us when to get out partially or completely. To think that any emotion is involved in our current long positions is a grave mistake. We do not have emotions in regards to the stock market at BWT. We only have quantitative signals. Nothing more and nothing less. When we are wrong we cut our losses immediately like in a recent long signal generated in WNC on 3/15 that we had to reverse on 3/19. The good news about that loss is that the stock is now setting up in an even more constructive consolidation pattern thus making the next long signal a higher reward to risk ratio setup. On that same note, however, a further follow-through on the recent breakdown below the 50 day moving average will have WNC completely wiped off our watchlist for now. OK everyone. Try not to get caught up in all the Euro news dramafest this upcoming week, let your winners run and cut your losses short, and most importantly have a great rest of your weekend and upcoming week. Aloha. Current Top Holdings – Percent Return – Date of Signal CSU long – 104% – 9/4/12 EAC long – 92% – 12/17/12 CAMP long – 90% – 4/26/12 POWR long – 80% – 12/11/12 HIMX long – 76% – 12/19/12 FLT long – 70% – 9/6/12 HEES long – 69% – 9/4/12 CPSS long – 56% – 1/31/13 AXLL long – 46% – 1/4/13 WAGE long – 42% – 1/8/13 ASTM short – 41% – 7/17/12 GNMK long – 38% – 11/16/12 MNTX long – 36% – 1/17/13

Big Wave Trading Portfolio And Top Current Holdings

The Big Wave Trading Portfolio remains under a BUY signal that was reinitiated on 3/5/13 following a quick, yet ugly, pullback. However, while we are under a BUY signal we are very cautious up in these stratospheric levels in relation to the major market indexes respective 200 day moving averages. That being said, as we know, the trend is your friend until the end when it isn’t. Overall, the low volume new highs is problematic on a technical level and at the same time is getting problematic on a bullishness level. Before 2008 there is no time in the history of the United States stock market you could find the stock market rally on low volume to new highs, sell off on heavy volume, and then make new highs on lower volume. Yet, that has been the same pattern since 2010. Over and over. Eventually, it is going to end and when it does it will be ugly. While there could easily be more new highs and further upside, the fact that we are getting such an extreme level of bullishness in the Investors Intelligent survey is worrisome. With bulls now at 50% and bears at 18% we have some very extreme reading seen before market pull backs. Like I said while more upside is possible, and would be welcome as per our current holdings below, we are aware of how frothy stocks look up here. On top of the extreme level of bullishness and bearishness in the II Survey, we have seen Richard Russell go long and have seen Mila Kunis finally enter the stock market as it is clear stocks do nothing but move higher. Right? Well, we will see. Going into this holiday-short week, we will remain cautious bulls and position any new long trend following signals accordingly. However, holding current longs and looking for exit signals is going to be the priority. Have a great week everyone. Mahalo for reading and aloha from a Kona-wind blown-out west side of Maui. Top Current Holdings – Percent Return – Date of Signal CSU long – 115% – 9/4/12 CAMP long – 90% – 4/26/12 HIMX long – 76% – 12/19/12 EAC long – 72% – 12/17/12 POWR long – 71% – 12/11/12 HEES long – 71% – 9/4/12 FLT long – 56% – 9/6/12 CPSS long – 44% – 1/31/13 AXLL long – 44% – 1/4/13 WAGE long – 41% – 1/8/13 GNMK long – 37% – 11/16/12 ASTM short – 35% – 7/17/12

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Model switched back to a BUY mode on 3/5/13 following a switch to a NEUTRAL mode on 2/25/13. The switch to NEUTRAL on 2/25/13 in our analysis of over 130 years of stock market history should have not switched back to BUY mode so quickly. The price breaks on 2/20 and 2/25 have historically led to months of choppy trading or started downtrends outright. The fact that we switched back to BUY mode so soon is historically extremely out of the norm. However, this entire market choppy and slow uptrend from the 2009 lows coming on such below average weekly and monthly volume is also historically extremely out of the norm. Huge volume selloffs are quickly absorbed and new highs, not on higher volume but, on lower volume are soon followed. As we have stated before, nowhere else in the history of the United States stock markets can you ever find this trend. Low volume rallies have always been quickly destroyed by higher volume selloffs or do not last long and are followed by heavier volume accumulation to the upside. The odds times continue. On that note, that means the only logical thing to do is to follow price here and be very careful with the size of long commitments. While Big Wave Trading misses the days when we plunged on margin, today’s market environment does not bode well for that type of investing. A more conservative approach is respected here knowing that a 2010 and 2011 shock experience is always just around the corner with a low volume market rally. Therefore, we will continue to operate on the long side enjoying the paltry gains we see below (paltry in comparison to the gains we produced before the QE and ZIRP world we have been living in since March 2009), until a clear trend change becomes apparent. For now, the trend is up. We will obey our master–Price. Top Current Holdings – Percent Return – Date of Signal CSU long – 115% – 9/4/12 CAMP long – 95% – 4/26/12 HIMX long – 84% – 12/19/12 HEES long – 71% – 9/4/12 EAC long – 65% – 12/17/12 POWR long – 64% – 12/11/12 FLT long – 58% – 9/6/12 AXLL long – 36% – 1/4/13 WAGE long – 34% – 1/8/13 PFBI long – 31% – 11/19/12 CHUY long – 29% – 1/10/13 CPSS long – 26% – 1/31/13 V long – 25% – 8/31/12 GNMK long – 25% – 11/16/12

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio Model remains under a BUY signal from 1/2/13. There is added pressure arising on the overall model, thanks to the Wednesday and Thursday distribution days and the overall wedging pattern of the overall uptrend. This, along with the lack of gains above 1.5% on higher volume, following the 1/2/13 signal, keeps us in the cautious bull camp which is where we have basically been following the third week of January. Despite the problems in the overall uptrend, we remain in an uptrend and until we have a series of 5 to 6 clear distribution days over a 2 to 3 week period we find it foolish to fight the Fed and unlimited QE. Some of our current long positions gave heavier volume partial profit taking signals and a few recent new long positions triggered cut loss levels. But overall it was a fairly orderly pullback. So far, at least. On top of that, we had multiple buyable gap up signals that worked very well intraday. It was a 4 for 4 session with 3 big IPO winners. Even though volume was lower overall on Friday, we have learned that price is all that matters. If stocks still have more of an explosive volatile bias to the upside on an individual basis then we will have our models focus on that area of the market. What will change our minds? The same things that always do. Our new longs start failing immediately, our current holdings trigger profit taking signals, and/or the market begins a rapid decline in heavier volume. Right now, we are on watch for further heavy selling. However, calling tops here, as it always has been throughout human history, is a foolish and unwise proposition. I recommend ditching the opinions and using a sound back-tested time proven systematic methodology that completely eliminates emotions. Top Current Holdings – Percent Return – Date of Signal CAMP long – 92% – 4/26/12 CSU long – 79% – 9/4/12 HEES long – 62% – 9/4/12 FLT long – 52% – 9/6/12 EAC long – 44% – 12/17/12 ASTM short – 39% – 7/17/12 POWR long – 37% – 12/11/12 WAGE long – 31% – 1/8/13 AXLL long – 31% – 1/4/13 HIMX long – 26% – 12/19/12

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio remains under a strong BUY signal generated at the start of the year. There continues to be absolutely no sign that the market is finished with its steady and unusual move higher. Trying to guess when the move will end is futile and until we see real cracks in the price/volume armor there is nothing to do but to continue to ride the trend higher until it shows signs of reversing. Those signs that we will be looking for include: 3 to 5 distribution days in 2 to 3 week time span on the indexes, climax runs in leading stocks, new highs in leading stocks on higher volume, huge volume reversals below the 50 DMA, a lack of new breakouts in quality names, and/or breakouts in quality names immediately reversing on heavier volume. Until we start to see a variety of the list above, we will continue to hunt for new long positions as they setup and breakout from sound consolidation patterns. However, we will continue to remain cautious on our purchases as the markets uptrend is without a doubt the most strange steady move higher I have ever seen or I believe studied in my career. While I have not backtested the data, the price pattern the past month and a half has been beyond unusual. To rally almost every day without having an up session above 1.25% is just the strangest thing I have seen to a start of a sustained uptrend. If you want to see how a real powerful rally looks that allows us to get 100-200% invested very quickly take the time to study the Nasdaq March 2003 low or the recent Shanghai SE Composite December 2012 low. That is what the start of real lasting powerful bull markets look like. They do not look like what we currently have in our indexes. I continue to refuse to increase the size of any new long position to the normal pre-2009 levels as long as we continue this strange wedging pattern higher. The longer we go without a normal correction or the longer we go without producing another powerful up day (I am looking for at least 1.5% and would really like to see a 2% move) on strong volume the higher our chances become of some sort of flash or quick crash that could easily wipe out our post 1/2/13 gains in a couple to a few trading sessions. The longer we wedge like this, without a powerful up day, the more concerned I will become and the more careful we will be of adding new long positions. This continues to be a pure-QE fueled uptrend and that is evident in the volume patterns on the indexes, ETFs, and leveraged ETFs. Volume is simply not confirming the move as it should if the uptrend was “normal.” So that is what we are “worried” about here. While it is something we are concerned about, we will continue to take signals as they are generated making sure that our opinions have nothing to do with the actual execution of our methodologies. A quick reminder to new investors. Big Wave Trading always and I mean always removes risk when we are wrong on any and all positions. Losses are never held. If we take a position and it violates our clear stop level, the position is liquidated immediately. Losses are never justified or held. Ever. Period. Big Wave Trading also employes historically sound profit taking methodologies created and proven by some of the best traders and managed futures funds since the dawn of time. If you are not familiar with these methodologies, we recommend going to the book section (which has not been updated in a few years–we will be doing that soon) on our website and purchasing these books to understand the methodologies that we incorporate in our portfolios. Aloha from a very cold, windy, and shockingly rainy west side of Maui. Have a great and profitable upcoming week. Once again, aloha. Top Current Holdings – Percent Return – Date of Signal CSU long – 77% – 9/4/12 CAMP long – 72% – 9/4/12 HEES long – 64% – 9/4/12 EAC long – 61% – 12/17/12 FLT long – 54% – 9/6/12 AXLL long – 40% – 1/4/13 ASTM short – 36% – 7/17/12 POWR long – 35% – 12/11/12 CPSS long – 33% – 1/31/13 MNTX long – 31% – 1/17/13

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio remains under a strong BUY signal from 1/2/13. There remains absolutely zero indications, via price action, that there is anything to do but ride the trend higher here. Despite the constant discussions of what is wrong with this rally and how extreme it is (we will go over that below), stocks continue to breakout from solid consolidation patterns with other stocks either trending up since breaking out or consolidating in preparation for possible breakouts. As long as we continue to see high quality stocks setup, consolidate, and breakout, we will remain buyers, despite the “overbought” conditions of the market. And trust me we are extremely aware about them at Big Wave Trading. While we remain buyers of stocks “up here,” we are being very selective and using appropriate capital for a market so extended. If we had more of our current holdings looking like they were putting in climax or parabolic type runs we would be more worried and would begin to hunt for protective put positions in the indexes. However, our longs continue to act orderly and do not exhibit the patterns seen at a market that is doomed to soon top. It still very well could but the price action in the market and stocks does not suggest that. We read all the headlines. We see all the news. For instance, 3-month sum mutual fund and ETF inflows are at 10 year highs, weekly mutual fund inflows are at 13 year highs, mutual funds have the least amount of cash on hand in 50 years, the VIX is too low at 13, the bulls are dominating the bears on the II (55 vs. 21) and AAII (43 vs. 30) surveys, and stocks are overbought on short-term oscillating indicators. That is all fine and well and we definitely take all bit of information into consideration as we prepare for the inevitable pullback. However, until it actually happens, there is no reason to take defensive measures now by selling stocks or eliminating new long positions. Imagine not buying the gap up in LNKD on Friday because you thought the market was too high. It clearly didn’t care what you thought and proceeded to move higher throughout the session. Therefore, until we get our 3-5 churning or distribution days in the market over a period of 2-4 weeks, we will continue to take long signals but keep the new positions relative to the overall safety of their pattern and the continuation of the overbought market. When the tide changes, we will take our profits when our signals are triggered and will add some protective put positions. Until then, the trend has been our friend throughout 2013 so far and until that changes it is wise to remain its friend. It will change. That you can be sure of. As of Friday, however, it is still up across all major market averages. Have a great rest of your weekend everyone. I wish you a very profitable upcoming week. Aloha from a very warm and sunny Maui. TOP CURRENT HOLDINGS – PERCENT RETURN – DATE OF SIGNAL CSU long – 70% – 9/4/12 CAMP long – 66% – 4/26/12 HEES long – 65% – 9/4/12 FLT long – 48% – 9/6/12 EAC long – 43% – 12/17/12 VRNM short – 43% – 4/10/12 POWR long – 39% – 12/11/12 ASTM short – 32% – 7/17/12 MNTX long – 31% – 1/17/13 AXLL long – 29% – 1/4/13 CPSS long – 25% – 1/31/13

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio remains under strong BUY signals across the board. While we still hate the relationship between volume and price, we realize it simply does not matter in a world where printing currency is the modus operandi. With that being the case, price is our master and price remains in a strong uptrend. It is Super Bowl Sunday and there is no need to psychoanalyze the action of the previous week. It was strong and there continues to be excellent price action in leading stocks. That is all you need to know. It has been a great start to the year and we shall see if this continues in the month of February. Enjoy the Super Bowl everyone. Aloha from a very warm and beautiful Maui. Top Current Holdings – Percent Return – Date of Signal CSU long – 73% – 9/4/12 HEES long – 65% – 9/4/12 CAMP long – 57% – 4/26/12 VRNM short – 49% – 4/10/12 EAC long – 46% – 12/17/12 FLT long – 35% – 9/6/12 POWR long – 35% – 12/11/12 AXLL long – 34% – 1/4/13 ASTM short – 31% – 7/17/12 GNMK long – 27% – 11/16/12

Big Wave Trading Portfolio Update And Top Current Holdings

The Big Wave Trading Portfolio remains under BUY signals across the board. There is nothing still to do or think too much about as the trend higher is smooth and has come under very little pressure minus two minor distribution days in the Nasdaq Composite. Overall, many traders believe that it is time for us to take a rest or pullback. However, traders have been thinking this for a while and until it actually happens trading on that notion is not wise. On the sentiment front, it is getting very bullish out there for sure. However, nobody said it can’t get more bullish. Who is to say that bulls can not hit 90% on the Investors Intelligence survey? Who is to say it can not hit 90% on the AAII survey? Who is to say that the VIX can’t trade below 5 or hell even below 1? I know that is quite irrational but nothing about what has happened since 2008 has been rational. There is no need to believe it is time to start now. We would love to see a pullback here as it would most likely lead to a very nice consolidation period in many leading stocks that would make their upcoming next round of breakouts that much more powerful. Our biggest concern with a non-stop uptrend is the possibility of a hard reversal that might lead to a sustained downturn instead of a buying opportunity. However, that being said, it is all talking points at this juncture. All that matters is price, and sometimes volume (though it hasn’t mattered since 2009), and that is what we will continue to focus on. Set buy stops on your favorite stocks nearing breakouts to make sure you get long at the exact pivot points and you will do fine. If you wait till the EOD to buy breakouts in this market environment, you greatly increase your chances of getting caught in a normal shakeout/pullback in the stock. Great luck next week everyone. I wish you all a very prosperous week. Aloha. Top Current Holdings – Percent Return – Date of Signal CSU long – 71% – 9/4/12 HEES long – 64% – 9/4/12 CAMP long – 48% – 4/26/12 VRNM short – 48% – 4/10/12 FLT long – 35% – 9/6/12 ASTM short – 35% – 7/17/12 GNMK long – 30% – 11/16/12 POWR long – 29% – 12/11/12 EAC long – 27% – 12/17/12 HIMX long – 26% – 12/19/12