The point of showing my order book yesterday was to emphasize how my number one focus is always risk management. At the time I entered many of the stocks, I expected them to continue to trend for most of the day. Even with expectations for continued movement higher, I sold partial positions into strength early on. I tend to go in aggressively as momentum builds and then scale out into continued strength. It is never my thought that I am selling at the top, instead, I am trying to reduce risk by realizing some profits and reducing my exposure. There are many times that a stock will continue to go higher without me and I am comfortable with that because, as we saw yesterday, the market can reverse quickly and erase all profits if you do not aggressively manage open positions. Some people say ...

1 word comes to mind of late - complacency. Today's medium sized sell off had me thinking of the last time the market sold off in a meaningful way. The fact I could not remember is a case in point. It looks like we had 1 day back there on April 11th but other than that since the quarter turned on April 1, it's been all good. Despite almost all bad on the economic front. No wonder everyone berates us with "it's all priced in", and "all up from here". If you review this week's postings you see 1 theme - selling and building cash. I'm back to nearly 20% in cash, and about 18% short exposure which is a very hedged exposure. I still am aghast this market does not treat $120+ crude more seriously - as I wrote ...

If you’re not already in a pretty delta-neutral place, think about balancing things out tomorrow ahead of the 2:15 fireworks. We closed out one of our newsletter positions today for a small loss so that we can ride through the rest of May expiration with less risk and little concern about the magnitude of any market reactions.

We won’t do the reversal readings tonight, suffice to say that (with the exception of the QQQQs) the indexes have worked off their previous short-term overbought conditions, relieving the pressure by way of time rather than price. Still, if you have a bullish perspective there remain some points of concern. VIX and More has some great material on possible market complacency here, while the Ticker Sense folks remark …