Strategy for Week of 11/08-11/12

I am going to hold off on offering any long swing trading setups for now, pursuant to the ideas discussed in my weekend videos. In essence, should we see immediate continued strength in the early part of this week, I would look to further layer out of the long exposure that I have left on the table. Alternatively, if we see a few quiet days of sideways action, or better yet a pullback to the 1190-1205 area on the S&P 500, we will likely see some sound swing trading setups on the long side present themselves again. Should that latter scenario materialize, I will post setups of stocks that have broken out and subsequently pulled back to what should be good support zones. 

The market is clearly very healthy at this point, as the 200 period weekly moving average has been recaptured by the bulls on the S&P for the first time in nearly 30 months (!). Swing trading in an established uptrend appears easy on the surface, but it is important to take profits and raise cash when sentiment and price start to get a little bit out of hand. By no means is this a form of calling a major top. Instead, it is how I choose to actively manage a swing trading style in a trending market.

While the temptation may to be look at those inverse ETFs once it appears the market will come in a bit, I believe you should exercise a good deal of discipline in that area. Given the bullish developments in the market of late, any bearish bets on equities should be made with the understanding that you are fighting a potent overarching trend, and should thus be kept on a very tight leash in terms of both stops and timeframes.