I’m Playing The Odds — Here’s What I’m Doing
Despite some evidence on both sides of the aisle,
bullish and bearish, each of which made a solid case, it appears as
though the winner is the bulls as of today’s close. Unless you simply bought
blindly a few weeks back, you probably wrestled with the gyrations, only to
arrive at today, with $$ in your pocket, but probably a little tired, bruised,
and overall, scratching your head.
Maybe I read too much into the action of the last few weeks, but I was
consistently concerned about the overnight air pocket to the downside. And with
reason: the VIX making new lows each day, sentiment readings at levels that
coincided with previous bear market rally peaks. However, this time we also had
strong internals, with new 52-week highs outpacing 52-week lows. The glass was
truly full and half empty. So now what? Well, from an HVT standpoint, the game
plan remains the same, be selective, the market is still not trading in a very
fluid manner. The longer-term intraday setups are a bit more robust
currently. However in terms of multi-day positions, I am flat and happy to be
that way. Just like with my HVT trades, I missed the move, I cannot chase. One
of two scenarios will unfold:
- The rally will hold and a healthy pullback will offer me a higher
probability entry pointÂ
- The bulls may very well be disappointed. I cannot rule out the possibility
of a failure.
Yes, it is possible that the low VIX
readings may not translate into lower prices, but at this juncture it is
imperative for me to play the odds. The odds will keep me on the sidelines for
the time being.
| Support/Resistance Numbers for S&P and Nasdaq Futures |
||||||||||||||||||||||
|
As always, feel free to send me
your comments and questions.
P.S. I have a new trading module and a new audio service coming out.
Click here for information about the module. Information about the new
service will be available shortly.