A Regular Barn Burner

After one of the biggest single day rally since early Mid-August, there is a surprising lack of enthusiasm from the various social platforms.  However looking across the stock complex there are some big moves taking place.  BABA caught a solid bid today, which might be important to the overall tone of risk.  Having literally sold the low right around the close yesterday after buying the opening print on Friday, I can tell you firsthand the tone was looking a bit dire on this one.

There were some strong moves today and we managed to penetrate the weekly-close cap on the Nasdaq.  The Nasdaq market seemed to be in a hurry today, and that makes sense given we are still operating inside of the slippery gap zone left behind back in 2000.  We are doing a really good job of properly and thoroughly auctioning these prices.

I made note on Twitter that this morning’s opening action put sellers in the hole.  This could be seen two ways.  First, we saw the early move up met with strong selling like we saw early Monday and Tuesday.  As soon as something becomes commonplace it becomes suspect, IMO.  Second we saw big rotations off the lows which would offer shorts entry, go their way a bit, and then very rapidly go against them.  This is prime fuel for trapping shorts.  Failed moves.  In the uncertainty I suffered two casualties however, V and NMBL.  From the looks of NMBL however, that might not have been a bad trade.  It is resting on support, it could bounce tomorrow but I still had a nice bit of premium left and did not mind salvaging it.

On the net we used the tight compression on the Nasdaq to fuel a move higher.  There is talk of a shakeup at the Chinese Central Bank, and according to modern QE economics, any and all central banking news is to be held in the highest priority.

Until we see some resolution to this battle taking place on the Nasdaq and other indices, the absolute best move is to stick to one side of the tape, seller or buyer, pick one, and position at the right moments.  Buying the breakout yields elevator shafts lower, selling the breakdown leave you deep in the hole.  It is truly that simple, this is our environment of bracketed, balanced trade.  Playing both sides is possible, but you need to really know where we are in the market and which stocks will work for you.  Every trader is unique, but for me there is no worse position then having both longs and shorts go against you simultaneously.

Trade accordingly and if you do not like the big oscillations, boost your cash.