We’ve seen unprecedented volatility in the market. The net result is that millions of investors have high cash positions. If you’re like millions of other investors who went to cash as positions ebbed and flowed below their long-term trend lines, you may find yourself wondering what to do now.

Now that the markets are on a general uptrend, how can you best put that cash to work for you in exchange traded funds (ETFs)? As we write, the Dow is up more than 350 points.

It’s important to keep in mind that even with the broad sell-off, the major market indexes remain above their long-term trend lines (the 200-day moving average). This is good. It signals that despite the correction we’ve witnessed, a general uptrend remains in place. [Lessons Learned in the Market Sell-Off.]

What you can do now is look for opportunities – the crux of the trend-following discipline. Many areas moved below their 200-day moving average, but in today’s rally they’re making a comeback. Case in point: Materials Select Sector SPDR (NYSEArca: XLB), a fund that closed 2.3% below the 200-day on Friday and is back above it today. [ETFs to Watch in the Wake of EU’s Deal.]

This is just one example; there are several opportunities like this all over the markets today. Look for those areas.

Of course, no one knows if Europe’s whopping $1 trillion bailout package is the silver bullet everyone’s looking for. The lingering question was whether the European Union would unify to save the threatened PIIGS economies, and it looks like that’s what they’ve done. With that, those country ETFs appear to be on the path to fair value.

We’ve just gone through a highly volatile time, and it’s important to keep an eye on your portfolio and have a strategy. If today’s big move to the upside is just a blip and there’s more trouble to come, what’s your sell strategy going to be?

On the other hand, if today’s move is just the beginning of a sustained rally, what’s your strategy for getting your cash off the sidelines? [How to Follow Trends.]

Determine the answer to those questions now and save yourself headaches and heartaches later.

For more stories about trend following, visit here.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.