Wednesday, March 2, 2011

Choppy Day

Today was a frustrating day to trade, and that holds true for both longs and shorts. On days like this, it is best to ignore overall indices unless important support/resistance levels are broken and concentrate on individual stocks. For a disciplined trader who keeps close stops, days like today are worse than big down days. That's not an argument for being undisciplined but for taking smaller positions and giving stocks room to run on choppy days.

On the overall markets, its hard to discern where the markets want to go from here. The SPX does look bearish but I have lost count on the number of time the chart has looked bearish only to make a big move up in the last one year. Personally, I closed my SDS position that I entered yesterday a little more than 1.5% gain. It made little sense to me to be hedged today as quite possibly, one could have lost money on  both longs and shorts.

Take care and good luck!

Tuesday, March 1, 2011

Position Update

At the end of the trading day today, I find myself ~40% long, ~20% short (via SDS) and 40% in cash. The two hedges (cash and SDS taken at 21.41 today) couldn't help my account being a tad over 1% down for the day. I did reduce my long exposure today but the open positions being small, I decided to give them room to run. Tomorrow should be interesting and I still think 1274 on SPX is very much on the cards. But before that, watch out for MA(50).

Take care and good luck!

Dollar approaching major support

As can be seen in the weekly chart below, the dollar is approaching multi-year trendline support. Keep that in mind while in forming your bullish thesis for the overall markets.


Take care and good luck!

P.S.: For the record, I am still long but my account is now hedged by an ~ 50% cash position.