Last week we initiated a position in a new technology name, Splunk (SPLK), in order to gain exposure to one of the hottest trends in the industry- “big data”.
Since the stock is up 10% for us in under a week, it is prudent to take gains here. I think there is still upside left in the name, long term.
But, short term, the stock is now overbought, according to the RSI (see chart below).
We are now down to only one technology name in the portfolio, Western Digital (WDC).
This stock is still consolidating, but we don’t mind, as WDC pays us a 3% dividend to wait for shares to resume their uptrend.
Sorry for the poor imaging, I am doing this all from my phone as I am out of town for the weekend, in Brownsville, for a basketball tournament.
Since the market is getting over extended here (almost back at all-time highs), we will trim $3,000 out of UPRO to rebalance our position back to $35,000.
With the recent batch of positive earnings released and the uplifting comments from the fed last week on an accelerating U.S. economy (albeit at a “moderate pace”), I am inclined to buy this market.
Let’s just wait for another dip before we do.
11/23/2015 9:26 AM
Re-entering SPLK on the pullback to its break out point; starting with half of a position.
The best-in-class, pure play on big data reported robust earnings last week, increasing revenues 50% yoy, and margins of 88%.
Eventhough the Founder resigned (usually a red flag), he stated that it was for “family reasons”, so the company doesn’t seem to be in any apparent danger.
In fact, SPLK raised guidance for the rest of the year; a sign of strength, not weakness.