Trading Like The Donkey

The markets sold off into the bell today after a session of chop and indecision.  This environment, of balance, is allowing momentum stocks to start working.  The high risk stuff, the strong stuff, like #teamsocials, GOGO, #teamsolars, and TSLA went to work—chipping away at the fragmented spirits of Christmas shorts.

My book rocketed higher for a second day, propelling me 1.5 percent on the day.  The hot knife of momentum cuts both ways.  I sold some BALT today.  Not much, a third of my position.  This is my method of swing trading.  When I reach a logical level of support or resistance I pull out my magnifying glass and stalk an exit.  There was a seller up here at prior swing highs.  There almost always is a seller at prior swing highs—in all stocks.  Jumping into a name as it breaks out worked throughout much of the year, but a more astute trader works tirelessly to position ahead of the move-to-breakout.  That way, if you are wrong you can usually scratch the trade.

I sold GRPN too.  I had a quick 5.5% in profits and I took them.  I do not particularly love Groupon, and ½ the deals I buy usually expire because I work too much to enjoy restaurants in a timely manner.  Most importantly, to my eye, buyers are getting a bit ahead of themselves.

And I needed the cash.

These sales took my cash up to 15% as we head into what may be the day to bust us out of balance.  We have lots of news flow on tap tomorrow and a tightly coiled market.  I want cash to either buy new charts should strength emerge or gobble up deals as liquidation sets in.

I had a firm grip on today’s intraday action.  I bought the early dip and sold the afternoon rip.  I felt pretty fancy.  My low blog view count stats affirmed my context was deadeye dick accurate, as they always fall off before I made a big win.

Let’s do it again tomorrow, shall we?