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Back in to two old friends.
LONG (full positions):
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TOTAL PORTFOLIO:
EQUITIES: 56%
CASH: 44%
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All trades documented inside The PPT.
(These are trading ideas only. Please use stop losses and do your own due diligence)
Comments »One of the stocks that I went long with a full position yesterday is $NR. I have had my eye on this one for a while now, and jumped at the chance to buy it yesterday. Despite the choppiness in the broad market today, this one is up over 10% at the time of this writing.
I do not advise you to chase this here. However, I think you would be crazy not to have this name on your scans of stocks to watch. This issue has seen consistently powerful buying volume over the course of the past few months. If you agree with my analysis here, I would suggest you wait for a light volume pullback to around the $6.30-$6.50 zone. Also note how easily you can define your risk, with a stop loss below the crucial 100 day moving average, which has been a brick wall for the bears.
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TOTAL PORTFOLIO:
EQUITIES: 40%
CASH: 60%
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In my estimation, it is now worth putting some capital at risk in this market. Even if we do not close at the highs today, the type of candle that is likely to be printed in many indices and stocks is a bullish one, especially after the steep downtrend we have seen. As I have said before, a market like this requires you to either sit out, or make some adjustments.
Taking risk is part of being a trader. Risk is everywhere and is involved with everything, just look at 2008, and then what followed in 2009. Being a contrarian is not a regular part of style. However, there are certain times when the risk/reward is too favorable to pass up, at least for the next few days. I believe this is one of those times.
I put 40% of my capital back in to the market on the long side. I am still 60% cash. All trades documented inside The PPT.
(These are trading ideas only. Please use stop losses and do your own due diligence.)
LONG–Full positions
Long live a bunch of academics trying to run the global economies!
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[youtube:http://www.youtube.com/watch?v=YlVDGmjz7eM 450 300] Comments »Over the past week, I have noted the emergence of a wide and choppy trading channel in the S&P 500. With today’s huge gap down, we are testing the lower end of that range. 1040 is a huge level, going back at least six months. I would imagine many stop losses will be triggered should be blow through it, despite the fact that we are becoming oversold again.
While there is certainly a distinct fear and pessimism in the air again, trading based on sentiment can be a tricky and highly subjective game. Instead of getting caught up in the emotion, keep this chart in mind as to whether we are truly seeing a major breakdown here. It is a zoomed in up to date daily chart of the S&P 500.
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I went back to 100% cash early this morning in an attempt to take some quick profits on my hedges, and to not let my longs get too far away from me should the market continue lower (it did). Needless to say, this type of market has been brutal for swing traders. I am leaning more towards buying potential support plays than anything else, but I am in no rush to be a hero.
My main focus is still on preserving capital until the market becomes healthy again.
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Back to 100% cash. Hedges taken off, and sold out of all longs. Go check The PPT for timestamps.
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