Kcap Capitulates a Little

The Dow and the NASDAQ are threatening to break out. The Small Cap action has been strong and even the Semi's have moved into positive territory. We have been wishing and hoping and doing favors for the Trading Gods in hopes of getting a juicier pullback. However, so far our prayers have gone unanswered. Fortunately we have been very long this market even after lightening up some exposure in the last few days.

We now find our selves in the same position that every other Bullish but tired trader is in. Do we attempt to further protect profits or do we yield to the potential breakout in the market. All of our experience and judgment tells us that the market has done an excellent job of sucking in idle cash. The chances for a sharp pullback are VERY VERY high. However money management discipline has forced us to not out-think the action too much rather go a little more with the flow.

Therefore we have reluctantly added a little more exposure into ETF's specifically iShares Russell 2000 (IWM) to play a potential short-term breakout. Rather than dwell on the concept of protecting profits we have done an excellent job of convincing ourselves that these profits should provide ample fat for when we lose money on this trade!

You may be able to tell that we are not happy campers adding in at these levels. If we find out that we bought any of your shares…remember, we have your IP address!...only kidding.

Hope you're doing well.

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