We haven't done much. All that trading in the final two weeks of the quarter was essentially negligible. Although we were up slightly for the month, I think we were better because we went with small share sizes to avoid any possible moves in either direction.
With the new quarter coming up, I think with today's trade we're starting to get a little bias on what we want to see. But it will depend on how the tape reacts in the next few days to determine if we start off on the right foot, or whether April Fools turns out to be a joke on me.
If you look at the last three months on the Russell 2000 and throw some Fibonacci charts on it, we could go either way. You have that big resistance line around 72 and then you have that support around 64. Everything in between is your retracement numbers. Now if speculating were that easy, we'd all by wealthy and retired. During these periods before the real move, you have two choices: a) sit back and wait for the confirmation (which can prevent losses, but also prevent profits) or b) stick a probe position and play the ranges.
At this time, I'm choosing b, since earnings season nearly guarantees movement.
Monday, March 31, 2008
Wednesday, March 26, 2008
Tuesday, March 25, 2008
Might be late but we'll know in a few hours
Got the pullback because of the weak ISM numbers. Unfortunately, didn't pull the trigger on the trades until an hour later after they had recaptured their opening gaps higher.
But we'll see if being late is lucky or costly.
New fliptrade Longs,
a) 100 X at 123.29
b) 200 NUE at 73.33
But we'll see if being late is lucky or costly.
New fliptrade Longs,
a) 100 X at 123.29
b) 200 NUE at 73.33
Wednesday, March 19, 2008
Trading notes this week
After yesterday's 420 point rise in the Dow, we were looking very stupid. Fortunately for us, the Dow gave back 290 points and allowed our position to turn slightly green.
Anytime you get a gift, TAKE IT. It's essentially saying you messed up, but the trading gods forgive you for your overconfidence. As Livermore would say, "Failure to take a gift will result in losses."
Now, I probably could have held another two minutes longer and got another fifty cents and doubled my profit, but considering the trade was bad to begin with, you better thank the gods that the "Two-thirds opposite reaction on Fed Day" held for once.
Now that we're back to all cash, we want to skip tomorrow as the markets are off for Good Friday. With the final week of the quarter, I would not be surprised if the averages try to rally starting next Monday and continuing for 4-5 days.
Regardless, let's keep an open mind on what is happening day to day. It appears that the big money is selling the winners of the quarter (Gold & Silver, Agriculture and Metals), at least in the past four days. So Gold & Silver are (ABX, GLD, XAU, and SLV), Agriculture is (POT, MOS, DBA, and MOO), Metals is Copper (PCU, FCX).
Energy is one sector I haven't had a good read, but it seems the selling has continued despite oil at $107/barrel. I'm guessing the moves have been in the OIH, XLE, COP, RIG, and NBL.
The general idea was to go long a market index for all of next week and then resume going short the market beginning April 1. But let's see if one of the charts decides to email a trade signal.
Anytime you get a gift, TAKE IT. It's essentially saying you messed up, but the trading gods forgive you for your overconfidence. As Livermore would say, "Failure to take a gift will result in losses."
Now, I probably could have held another two minutes longer and got another fifty cents and doubled my profit, but considering the trade was bad to begin with, you better thank the gods that the "Two-thirds opposite reaction on Fed Day" held for once.
Now that we're back to all cash, we want to skip tomorrow as the markets are off for Good Friday. With the final week of the quarter, I would not be surprised if the averages try to rally starting next Monday and continuing for 4-5 days.
Regardless, let's keep an open mind on what is happening day to day. It appears that the big money is selling the winners of the quarter (Gold & Silver, Agriculture and Metals), at least in the past four days. So Gold & Silver are (ABX, GLD, XAU, and SLV), Agriculture is (POT, MOS, DBA, and MOO), Metals is Copper (PCU, FCX).
Energy is one sector I haven't had a good read, but it seems the selling has continued despite oil at $107/barrel. I'm guessing the moves have been in the OIH, XLE, COP, RIG, and NBL.
The general idea was to go long a market index for all of next week and then resume going short the market beginning April 1. But let's see if one of the charts decides to email a trade signal.
Tuesday, March 18, 2008
Note on trading FOMC meetings, take your profits faster
Because I look at things technically, successful day or swingtrades require two components. It is not enough to have the perfect entry for a trade such as today by capturing the entry point for TWM about 70 seconds before the FOMC announcement. You should not be counting the $2.5k you almost had during the fifteen minutes after the announcement because YOU HAVEN'T CLOSED THE TRADE.
While mentors emphasize a lot on entry, I think that having an exit strategy is just as important because that determines how much profit or how little loss your trade will become.
In hindsight, on FOMC meetings, once your position is up 2 points on an ultraindex etf, you probably should move the stop to about ninety cents above your buy or short point so that you'll have enough time to close the trade in case of a reversal move, which happened within five minutes. The moves are much faster on an FOMC meeting and if you want, setting a stop about fifty cents below the 10 min EMA as a stop, will prevent you from having the deer in the headlights look. Also notice that if the 5 min EMA rolls over the 10 min EMA, and the RSI has dropped from above 70, it's likely a sign that the move has played itself out. Which is what happened here. Despite the TWM immediately going to 89.50 pulling back to 88.30 then climbing to almost 91, there were several chances to look in that 15 min trade for at worst a $1200 gain.
Unfortunately six days away from the markets because of other nonprofitable sporting activities was a very costly lesson. Now that we're stuck, we have to hope that we can either get out for a small loss or ride out the current move.
While mentors emphasize a lot on entry, I think that having an exit strategy is just as important because that determines how much profit or how little loss your trade will become.
In hindsight, on FOMC meetings, once your position is up 2 points on an ultraindex etf, you probably should move the stop to about ninety cents above your buy or short point so that you'll have enough time to close the trade in case of a reversal move, which happened within five minutes. The moves are much faster on an FOMC meeting and if you want, setting a stop about fifty cents below the 10 min EMA as a stop, will prevent you from having the deer in the headlights look. Also notice that if the 5 min EMA rolls over the 10 min EMA, and the RSI has dropped from above 70, it's likely a sign that the move has played itself out. Which is what happened here. Despite the TWM immediately going to 89.50 pulling back to 88.30 then climbing to almost 91, there were several chances to look in that 15 min trade for at worst a $1200 gain.
Unfortunately six days away from the markets because of other nonprofitable sporting activities was a very costly lesson. Now that we're stuck, we have to hope that we can either get out for a small loss or ride out the current move.
Tuesday, March 11, 2008
Dow down 200 last Fri, down 140 on Mon, and then saved by Bernanke up 417 (best gain in 5 years)
Looking like I missed to best exit point by two days. At the close of Monday, the Dow was approaching the lows of the year from January 22. Before today's open, Bernanke announced some $200 billion plan to save the banks. Which is of course stupid, but the Dow opened up 260 points before the first trade. After consolidating to only up 150 around the 1:30p mark, Turnaround Tuesday made its mark, as mystery buy programs and volume showed up all the way to the close.
Unfortunately, we didn't catch any of this. So let's take a guess on where we think the averages may go. I'm looking at a three month chart of the Dow on a 30 minute time frame. Think the safest point to think about shorting is about 12600 or about 450 points above where it closed today, because it might want to go back into the recent two month trading range.
The S&P 500 has a similar chart and I think 1370 is the likely point to look as the first probe position for a short.
In the meantime, I had a few momentum long ideas, and if I feel completely wacky, maybe I'll play one while the trend temporarily has shifted higher.
It's probably best to stay away from the ultrashort ETF's for at least another week and a half.
Unfortunately, we didn't catch any of this. So let's take a guess on where we think the averages may go. I'm looking at a three month chart of the Dow on a 30 minute time frame. Think the safest point to think about shorting is about 12600 or about 450 points above where it closed today, because it might want to go back into the recent two month trading range.
The S&P 500 has a similar chart and I think 1370 is the likely point to look as the first probe position for a short.
In the meantime, I had a few momentum long ideas, and if I feel completely wacky, maybe I'll play one while the trend temporarily has shifted higher.
It's probably best to stay away from the ultrashort ETF's for at least another week and a half.
Thursday, March 6, 2008
And how bad was that prediction
Markets decided to tank, making that TWM sell sure looking stupid. Dow finished near the lows of session off 200 points. Other averages down around 2% with the Russell down 3%.
Disgusting to not have an extra $6k for being a "Careful Mike Sucker".
Disgusting to not have an extra $6k for being a "Careful Mike Sucker".
No positions, making a prediction
Since I cannot win or lose money with no positions. I'm thinking we're about to see another of those mystery 90 point rises in the Dow whether from the PPT or a CNBC pundit blaring a fake positive news item. Watch the Dow finish the day only with a single digit loss versus triple digit.
That's what I think the tape is telling. Let's see how it turns out.
That's what I think the tape is telling. Let's see how it turns out.
While you were asleep, JOYG back above 70
They reported earnings. Stock up 6% today.
Just live and learn. We've left some money on the table with TWM up almost 3 points today. But have to stick with your plan. Think about legging into to whatever trade you see in about two weeks.
We can only guess at what the market reaction for tomorrow's jobs reports. I'm guessing we closed because we were afraid of a "bogus" positive spin on the report could wipeout the TWM move. You won't go broke taking 4 point profits, but you also won't get rich leaving another 3 points on the table.
Market averages down 1% across the board at moment.
Just live and learn. We've left some money on the table with TWM up almost 3 points today. But have to stick with your plan. Think about legging into to whatever trade you see in about two weeks.
We can only guess at what the market reaction for tomorrow's jobs reports. I'm guessing we closed because we were afraid of a "bogus" positive spin on the report could wipeout the TWM move. You won't go broke taking 4 point profits, but you also won't get rich leaving another 3 points on the table.
Market averages down 1% across the board at moment.
Wednesday, March 5, 2008
Annoyed at yesterday's final hour recovery
As the Dow was sitting around 12100; around 2:55pm, one of the CNBC pundits came on the air and made some comments about a plan to assist mortgage insurer Ambac and turning a 180 point loss in the Dow to a 45 point loss by the close.
The sickening thing was the move stopped out our entire TWM position at 86.09 yesterday. So now we're 100% cash. Sad thing about all that was because of the number of bad hedge trades using long oil companies ate most of the profits on the TWM trade. The end result of was a measely .33% gain or just under $700.
It would figure the markets after initially rallying over 120 points on the fake ISM numbers are now down 40 points with 2 hours left in the trading day. The TWM is back to 87 so we're on the outside looking in until we find another setup.
YTD -4.73%
The sickening thing was the move stopped out our entire TWM position at 86.09 yesterday. So now we're 100% cash. Sad thing about all that was because of the number of bad hedge trades using long oil companies ate most of the profits on the TWM trade. The end result of was a measely .33% gain or just under $700.
It would figure the markets after initially rallying over 120 points on the fake ISM numbers are now down 40 points with 2 hours left in the trading day. The TWM is back to 87 so we're on the outside looking in until we find another setup.
YTD -4.73%
Tuesday, March 4, 2008
Watchlist: Imperial Sugar, IPSU & IPSUW
One of the traders who rode this from 23 to 50 mentioned this other day as its made a roundtrip back to its lows. The common trades around 19.80 and the warrants expiring in Aug of 2008 trade around 2.85.
Jim Rogers likes to mention that sugar is one of the few commodities trading 60% below its all time high so here's one to keep an eye on if it gets a move on.
Jim Rogers likes to mention that sugar is one of the few commodities trading 60% below its all time high so here's one to keep an eye on if it gets a move on.
Raise your stop on TWM to 86.09
In downtrending markets, any potential reversal moves whether its the PPT or Bernanke related will come without warning, and you do not want to lose all those profits.
At worst, you'll be stopped out but you can always reenter the winning trade at a higher price point.
In uptrending markets, you can afford to be loose with your stop because the pullbacks to the 5-day, 10-day, 20-day, 30-day, and 50-day moving average are designed to shake out the weak long. But in downtrending markets, there is no guarantee of a reversal move to recover either a breakeven position or some of your profits.
At worst, you'll be stopped out but you can always reenter the winning trade at a higher price point.
In uptrending markets, you can afford to be loose with your stop because the pullbacks to the 5-day, 10-day, 20-day, 30-day, and 50-day moving average are designed to shake out the weak long. But in downtrending markets, there is no guarantee of a reversal move to recover either a breakeven position or some of your profits.
Monday, March 3, 2008
Lucky the market tanked on Leap Day, personally in the black for Feb
Fortunately, historical precedent held as Feb 29 is a down day. What we didn't expect was the 3% down day turning our big TWM position to green and finishing the month up $330 or .16%.
Now that the position has turned green, put an auto stop around 82.90 so that we don't look completely deerish.
The real movers in the prior week were a casy play and the metals:
casy play EOG finally got a move on, up 21 points last week and up another 3 today, (just like Livermore said, the $100 price point, key psychological point)
ATLS up 10 points over two weeks, and where was I, yes early on index shorts before getting lucky.
SLV up to 196. It's up another 4 today, so my timely coworker cost me 30+ points.
KGC up to 25. Wouldn't have caught it but a heck of a move.
MTL to 137. Your bread and butter cup and handle. It's a missed trade.
Now on the downside, FWLT, they reported earnings last week and got crushed 10 points. When a former high flier has that type of reaction, either new leaders emerge or the market is in trouble. So far its looking the latter, which ironically, is good for me.
Now that the position has turned green, put an auto stop around 82.90 so that we don't look completely deerish.
The real movers in the prior week were a casy play and the metals:
casy play EOG finally got a move on, up 21 points last week and up another 3 today, (just like Livermore said, the $100 price point, key psychological point)
ATLS up 10 points over two weeks, and where was I, yes early on index shorts before getting lucky.
SLV up to 196. It's up another 4 today, so my timely coworker cost me 30+ points.
KGC up to 25. Wouldn't have caught it but a heck of a move.
MTL to 137. Your bread and butter cup and handle. It's a missed trade.
Now on the downside, FWLT, they reported earnings last week and got crushed 10 points. When a former high flier has that type of reaction, either new leaders emerge or the market is in trouble. So far its looking the latter, which ironically, is good for me.
Subscribe to:
Posts (Atom)