Pausing

➤ S&P500 sold-off on Friday. This can be attributed to poor data out of Europe and also profit-taking prior to weekend (about time!)

➤ My exposure remains at -50%. That means we are short the market using half of our capital. This is low-moderate conviction. The maximum is +/- 200%, the level of highest conviction.

➤ Friday price action saved our shorts from being stopped out. It was a close shave. At the moment, I only see this as a pause in the bull-run. Prices are "trapped" in the pink zone of indecision. There are defined resistance and support lines. The zone is narrow. Prices can still easily move up. I need to see a big move in the VIX to the upside to instil confidence that the Bears have taken control.

➤ Conclusion: Price moving below the pink zone should see Bulls lose confidence.