Smoke ‘Em If You Got ‘Em
On Tuesday, the Nasdaq gapped lower and followed through to
the downside for a nice trend day lower.
The S&P also sold off hard.
So what do we do? Right when it starts to feel good and
easy on one side of the market is usually the exact time you should start
locking in profits. Therefore, let’s consider ourselves lucky to catch such a
sharp down move and begin to look to take profits and trail stops. Also, one last
point, based on the weak close, we could “pop down” on the open. This
might be a good time to lock in profits. In other words, “Feed the ducks
while they are quacking.”*
No setups tonight. Use this opportunity to take profits and
trail stops. If you are a nimble daytrader, look to nibble (buy) at the index shares
should the market “pop down” on Wednesday. Just make sure to honor
your stops and don’t overstay your welcome.
Walk Through Continued
Recently, I had discussed that breakeven plus
would be a good place for a stop (after taking partial profits) on Coach Inc.
(
COH |
Quote |
Chart |
News |
PowerRating)
(see archives for more details). This way, barring overnight gaps, the worst you
could do was breakeven on the remaining shares. And, this allowed for a
potential “home run” on those shares. Once again, let’s assume for educational
purposes that this stop still stands (a). If the recent lows are violated (b),
we’ll assume that we got stopped out on the rest of the trade.
Smoke ‘Em If You Got ‘Em
Stocks mentioned last week (see archives) such as Goldman
Sach
(
GS |
Quote |
Chart |
News |
PowerRating) have made significant moves lower since then. If you are fortunate
enough to be blessed with such a quick profit, make sure you lock in a piece.
Still Pleading
I was unaware until after the fact that they were not
videoing my Trading Markets 2001 presentation. However, I noticed that someone
there was making a personal copy. I would love a copy for my own viewing (I’ll
explain in further detail why if you contact me). I would be happy to pay any
costs incurred to duplicate/ship the tape (and throw in a book and two
years of my trading service for your troubles). Please contact me via email if
you have this or might know who does. Thanks!
Best of luck with
your trading on Friday!
Dave Landry
P.S. Reminder: Protective stops on
every trade!
*I first heard this quote from Linda Raschke. I’m
not sure who she was quoting. One other point, just remember, if you feed ducks
peanut butter, you get peanut butter and quackers.
“……passing
on Dave Landry on Swing Trading because of its price tag would be a mistake.
It’s a detailed and understandable trading strategy book…..”
Active Trader
Magazine,
February
2002 issue.
No risk,
30-day, money back guarantee.