That said, let me state upfront that I'm not advising you to simply copy my actions for your own portfolio. My objectives and risk tolerances could be substantially different than yours. With that caveat, let's move ahead.

Market Indications

Last week, the market helped all the bulls get a little richer. April is turning out to be a very strong month. My longer-term market indicators remain solidly bullish, while my intermediate indicators weakened just slightly in the face of last week's strength, and these signals translate to my current target cash position of 4%.

My set of three intermediate-term indicators includes the total volume of individual equity and index put and calls on the Chicago Board Options Exchange, the CBOE option ratio (which is similar but excludes index options) and odd-lot sales and purchases. Of my three intermediate indicators, one is very bullish, one is bullish and one is neutral.

The chart that follows shows the indicator that is now neutral, the odd-lot oscillator. In general, an odd lot is any transaction of fewer than 100 shares, often thought to represent small individual investors. This five-year chart shows the S&P 500 in black and the ratio of odd-lot sales to odd-lot purchases in red. The other green trend lines relate to the last three years' averages and standard deviations. This is a contrary indicator, meaning that when the odd-lot investor is selling (the red line is high), we want to be buying.

Click here for larger image.

Source: TheAstuteInvestor.com

This indicator was in very negative territory in January and February, as the odd-lot investor was complacent and in a buying mood. Lately, though, the indicator has improved, as the sharp break in early March has raised the fear level of odd-lot investors. However, this remains my weakest indicator.

Portfolio Applications

So let's take a look at how all this is affecting my trading. (For a complete explanation of my investing method, please click here.) Here's a table of my IRA portfolio: