Here’s A Long And Short In The SMH Today
‘I know, I know’–the trend is
your friend, as the saying goes on Wall Street. Well, to be quite honest, Wall Street says a whole lotta stuff, and
for the most part you’re really better off not listening. With today’s market
action, one might call the market quite resilient…personally, I have another
word in mind, but that’s besides the point. As a ‘cautious bull’, the market, as
you know from my recent writings, isn’t exactly ‘making the cut’ for me, as the
broader market has yet to pull back even 2% during the past few weeks. When I
look at that, and the fact that more and more stocks are acting erratically, I
don’t get the heebeegeebees (actually I do)…nope, I just look to capitalize on
the situation the old fashioned way–by attempting the high-probability shorts,
when and if they appear.
In today’s trade, the early action had our index
and sector friends gapping lower off a number that caught all the raging bulls
off guard (omigod, something other than terrorism can make the stock market
go down!!!). Technically, when I saw the trendline break in the semiconductor
holders (SMH) this a.m., on the extended intraday chart, I was approaching the
market as ripe for more follow-thru to the downside…but, I was also waiting
for the high-probability trigger to appear.
09:46:30
Intraday Setup Alert
Here we go again….the semiconductor
proxy (SMH)
has formed an intraday
Opening Reversal consolidation after gapping down on general market
weakness. The proxy can be traded either way out of the intraday pattern using
the 5-minute chart–but this particular analyst has a ‘sell side’ bias. With
today’s trade, a double daily top is in place, and on the 30-minute chart, the
uptrend line has been broken with today’s action. The SMH is off .48 at 44.34.
…oh well, so maybe I missed the latest move,
but the choice was yours to make for yourself. Personally speaking, I can watch
the market move without me once in awhile when I really don’t consider it
high-probability stuff, or I’m just at a plain ol’ loss for words, because I
know if I’m patient…..
13:31:04
Reversal Setup
The semiconductor proxy (SMH)
has formed a
1,2,3, after trading up to fresh 52-week highs. The SMH is up .49 at 45.31.
Yeah, it would have been nice to have taken the ‘money trigger’, but I
honestly don’t believe that it’s always appropriate to trade from both sides. My
motto is, if I don’t understand something well enough–it’s time to sit on the
proverbial thumbs, until something comes along that does make ‘common cents.’ So
while to some it might appear that I’m being pretty dumb about trying to ‘fight
the trend’–I can say at least I keep my stupid ideas to the
high-probability setups, and those that do end up triggering–end up working out
just fine for themselves.