VERY FEW THOUGHTS HERE

Welcome back from the weekend. Nothing better than a 4 day stretch where the last thing on your mind is stocks.

I’m doing my best to find a rhythm here. My only thoughts here this morning is that I love that move in the Shanghai, I’d like to short Gold, and I just took a long in $GS with a tight mental stop here. The market spot isn’t much to get excited over though. Like most, I’d like this thing lower.

Still watching $BIDU, $TOUR, $TAN, $KITE, and $KATE.

More later,

OA

In as long as I can remember, there’s literally no setups out there to trade. I bought some GPRO yesterday and GOOGL this morning…but I’ve only got two other names I’d trade here and that’s all. CENX and GME.

When this happens, either the market is going to correct a bit, or the pain trade is in effect across most stocks. I’m thinking the latter with how strong breadth has been. A V reversal from the middle is a tough market set up, but we’ve obviosuly found eager buyers.

I am still positive on the outcome of all this. I have minimal cash available here, some underwater call positions, and a fully invested LT account. Time to set sail soon.

OA

After Hours with Option Addict folks, the login for the week has been posted on the After Hours with Option Addict blog.

More thoughts about the market here in a few.

OA

If we are near a bottom then the first rally always fails. It’s part of the discouragement process.

Since im not sensing much discouragement out there, I’m thinking we’re not done moving lower.

Don’t let higher prices lure you in. Rather, wait for that crowd to buy up and bet against them. The objective here is to initiate from lower, not higher.

To my After Hours with Option Addict club, we’re going to experiment with meeting DURING market hours this week starting tomorrow. There will be no meeting today, but starting tomorrow you’ll be able to trade with me from market open til around the lunch hour. This will go on for the remainder of the week.

I will post a link and password on the After Hours blog later today that will work tomorrow morning.

OA

I’m going to start with a longer term monthly chart of the Nasdaq. In terms of where the market is in trouble, I am using the following levels to work off of.

Using the NQ, which has been the index I’ve been using, I could see us grind down another 100 points from here. At that point, you may get an oversold McClellan to work with.

Now that prices have come back to the lower end of this range, I think it pushes back the timing of when we could break away from this by a few months. In other words, the daily chart was getting pretty compressed, but this move to the lower end keeps the monthly range contracting. That monthly range says we could still be here, at these prices in 2-3 months.

That’s the most depressing part about all this, in my opinion. More time must pass.

OA

I booked a few gains to pay down a few losses this afternoon. I haven’t logged into the IRA today, but will wait til next week to rebalance a few things. Thinking I’ll reduce my $AMBA after a nice run, sell $BYD for a gain, add to $UA and start a few longer term positions next week.

Last time we had a move like this was 8/24. This was a Monday. The market ripped higher to the tune of 4% early in the session, then totally shit the bed into the close. That move triggered the 80% bearish poll in After Hours with Option Addict. I bought into that failed rally and caught a big market swing over the next few days.

Not sure whether we follow a similar template here…but the one thing you can count on is that these moves take time to heal. I’m surprised at how well stocks held up. This may just be the start of something, but that’s the thing I am very focused on here. So many good stocks are trading at their lows for this week, or last week. They are receiving the type of drop they could have had on a random -1% S&P drop. It doesn’t feel too panic yet, which is why I’m going to see how things look on Monday.

The market analysis into these scenarios has been a little easier for us these last few times we’ve been in these situations. If you approach this with “pain trade” in mind, you should do fine.

I closed 5 positions today, and purchased shares of $OCLR and $TROX. We’ll do some technical comparisons in After Hours with Option Addict after the bell.

OA