Sell In May and Go Away

My math shows that from the open on May 1st to today's close, the Nasdaq Composite has returned 2.5%. With one more day to go in May and the index closing at the high-of-day, its safe to say that selling this May would have really been a big mistake. Record levels of shorts tell me that many have made this mistake. As the Nasdaq needs only 8 points to trade in record territory, it is possible that the index will test the recent high very soon. Will new highs prompt the shorts to begin unwinding positions? I'm also wondering if the shorts are holding out for the summertime doldrums and the associated low volume to provide a better environment for unwinding some bets.

As for now, it seems the market wants to keep going up. I included this chart of the Nasdaq to illustrate two points. The first point is that almost all of my positions made candles today that look exactly like today's candle on the Nasdaq. The second point is that the only element that has me a tad concerned is the lack of volume in the Nasdaq today.

The exception to all today's pretty candles,VRTB, made a very ugly candle. That position will probably be eliminated shortly, as I am over-diversified, and should be reducing "diversity-exposure" (I just made that up. I hope what I mean is clear. Probably not.) and using the extra cash to add to winners. Everything else looks great, with PFWD breaking out, MVIS going parabolic, ARWR winding up, and even my laggard CLWR closing green. Oh, and I bought 100 HANS today @ $39.76, even though I hate the stock. So much for reducing diversity-exposure.

I have to admit that I'm ready for the stock gods to rip my new gains from the clutches of my hot and sweaty digits. Also, I'm not getting anything done at work. I'm going to quit this post now as not to jinx things.

If you are searching for more ideas to trade, I found Stocktiger tonight, and he has some decent setups in his video charts.