Remain Flexible
As we head into the weekend and wrap up options
expiration, who knows what other surprises the market will throw at
us? After many months of investors "ignoring" the sad facts of the
economy and stock valuations, the market once again finds itself of shaky
ground. However, as you all know, when things become obvious, in this case a
down trend, we should look for buying opportunities in the short-term. The
problem is I just do not see any real compelling long setups other than quick
trades based on five- or 15-minute charts. Cash is fine right now, there is no
need or requirement for you to be putting your capital to work each day, with
the exception of some intraday setups which can always be helpful in terms of
adding total return to your account each day.
Given the short-term oversold condition of the market, I have covered all
short positions as of the close yesterday. Most of the positions were
established on Monday and Tuesday, and given the choppiness of the markets
recently, a few days is about all I am willing to hang around. This market has
taught me many valuable lessons this year, just like HVT
trading where you are locking in small profits each day in an attempt to
maximize total return, I have found myself being forced to do the same thing
with my "swing" trades. This is truly a trader’s market, and even that
does not make the task any easier.
So for now, I will purely be focusing on HVT and waiting for the
market to offer some clues as to where it may be heading going into next week.
My bias is to the short side, but I remain flexible knowing that rallies in a
bear market can be very powerful and rewarding. I will keep you posted, or you
can check in with my
nightly service for more specific trading ideas.
If you decide to trade in the afternoon session today, just be aware that due
to options expiration, the volatility, while fierce can be quite unpredictable.
|
Intraday
|
|
|
|
|
| Stock | Action |
| HI | Short |
| GENZ | Short |
* always line the above trade setups
with the overall direction of the market and use a protective stop loss.
Key Technical
Numbers (futures):
S&Ps |
Nasdaq |
| 872 | 901-04 |
| 869 | 892-94 |
| 864 | 886 |
| 857 | 882 |
| 848 | 878 |
| *841-43* | 870 |
| *830-32* | 860-63 |
| 822 | 850-53 |
| 817 |
* indicates that the level is more significant
If the market does in fact turn to the upside, keep an eye out for 864-65,
that is my near-term price target.
As always, feel free to send me your comments and
questions. See you in TradersWire.