10-19-14 Trade Plan

With lower highs and lows the market did what it does best in downtrends, make bigger moves lower than it does higher.  The volatility is bringing back a lot of very short term opportunities in both price directions and the actual volatility of the options.  Getting in some puts or any long IV/short delta option positions before a nice one or two day decline can really pay off especially if you have the timing required to trade the weekly cycles.  Bonds and volatility ETFs were trading great this week and after a few weeks of lack of opportunity with long stock positions it was good to change focus and make money with it.

In my opinion we are past the point of V shape straight back up reversal, this is going to take at least a month or two of chop and consolidation if we are going to reverse back up.  Which would make sense as the market waits on the only fundamental piece of information it cares about, whether or not we see more QE.  That consolidation could happen at these levels or it could happen 10% lower, as long as you are following major swing points and trend you know which direction to expect the big moves and where to define your risk if you want to trade it.


10-12-14 Trade Plan

The bears prevented any higher highs/lows and kept the selling going with a 130m down trend.  More volatility is here and that requires different trading styles than riding up trends or none at all.  I like doing end of day index trades where risk reward is good for a one or two day trade.  Also trading bonds, oil, gold, volatility ETFs, even some shorts if there's a good setup in the liquid stocks I trade.  I'm always weary of pulling out this style of trading because it seems like when I do or think about doing it the indices reverse and it's time to get long stocks.  But it does exist, and with QE ending, IWM breaking down in a serious way, nearly all bullish setups failing, it's time to put that card on the table.


10-05-14 Trade Plan

What we have in the indices is intraday down trends going against the daily uptrend and I prefer to have both in alignment for a good uptrend.  Even with the strong V shape reversal we saw on Thursday and Friday, it is still a lower high after a lower low.  Bulls could do one of two things if they are taking control from here, take out 9/30 high which would make a higher high and give lots of room for higher low or put in a higher swing low above the 10/2 swing point.  If bears are still in control they will keep the pattern of lower highs and lows.


09-28-14 Trade Plan

The indices are still chopping around and small caps are under performing pretty bad.  The Dow failed in trying to lead the market higher but is still holding up better than the S&P and the NASDAQ is holding up better than all of them.  So that keeps my focus on the NASDAQ and the Dow.  But no matter what is looking better on a relative basis I still need to see higher highs and lows on an intraday trend to be more aggressive in taking positions and looking for leading moves.  We don't have that yet, let's take a look at the 130m charts.


09-21-14 Trade Plan

The indices are holding up well with now the Dow Jones leading the way higher.  I don't exactly love trading the Dow and Dow stocks but you go with the flow of the market.  If the Dow wants to try to be the "surprise performer" for a little bit then so be it, I'm willing to give it a shot and trade some good setups in large caps.  Especially when setups were starting to dry up in tech stocks as I was saying last week.  The Russell is still a mess and did end up breaking that $115 level, which put it in negative YTD again and told me to move on.  NASDAQ isn't in a bad spot here, breaking last weeks high could trigger a new leg up and that's something I'll be watching for along with the Dow move that is in progress.


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