Key Takeaway
Technical Analysis is full of varying scenarios that can be viewed in very different ways. Below are three separate ways to look at the same chart of the S&P 500 - each telling a slightly different story. In two of the three scenarios below, it appears that we are at the "upper end" of the current range, which explains why our cash levels are elevated. A near-term breakout out would enable us to find breakout stocks and ultimately have far less cash; however, a breakdown will justify our higher cash levels, and allow us the opportunity to put the cash back to work at potentially lower levels.
Scenario #1:
Scenario #2:
Scenario #3:
Cannon AIQ example:
Regardless of any of the stock market trends or market conditions, we use our signal strategy to help identify when we should get into or out of a particular position. Below is an example of a recent signal for an active position within one of our stock sleeves. Obviously there is no guarantee; however, our strategy has done a very good job so far of identifying good stocks to pick up, as well as good times to sell them.
