Rule of thumb: when trading trash and it rises quickly, sell just as fast as you bought. We’re not voting at annual meetings or looking forward to earnings. We take our money and go.
Heading into today I was 135% leveraged, long stocks like GMBL and NAKD. As soon as the market opened I began to sell until I sold it all, 100% cash, up 230bps for the session. This doesn’t mean that I am bearish. I only wished to lock in gains and avoid a potential morning reversal, which is prevalent in poorly traded markets, something we are in now. Lo and behold, stocks COLLAPSED from the open — now basing out and looking a bit better. I allocated 5% into one stock and will now wait until I see favorable patterns.
Presently, 100% of my trading is based off volume patterns, which I am quickly able to analyze in Stocklabs using our volume tools. I want to know what is spiking and by how much. I have not looked at a chart in over a year, now up 173% YTD.
Into mid-morning, I am looking for breadth to improve to greater than 50%. If not, I might remain in cash.
If you enjoy the content at iBankCoin, please follow us on Twitter
Kudos