What an interesting day on the street today (even if not all that surprising). You’d think that the bears are completely in control right now, but I do not endorse that notion just yet. Tomorrow is going to be a day (I hope) where a direction is chosen. Aside from sideways, (which is always possible) we are either going to bounce off of this short term double bottom and resume the bullish run OR we are going to break through support (see $SPX chart below) and the bears will be in town. I like a close below 1596 on the SPX for a confirmation of the bears. Despite oscillators being bearish, my gut tells me that we are going to get a bounce, but my gut does not drive the market. Therefore, I will be waiting and watching patiently to see what the market decides to do.
I got crushed on HD; stopped out for a 10% loss. This is incredibly disappointing because I was up 26% on Monday and did not take profits even though my target was reached. The market looked like it was off to a strong start so I just let it go. Then on Tuesday I had a chance to take a 15% return, but refused because I wanted to get back to 26% and again today I had a chance for a 10% return but refused which ultimately landed me with a 10% loss. Very disappointing, but a very good lesson learned: Stick to your trading plan and take profits at your target or worse case, move your stop up to your target if you are over. Learning when to let my profits run and when to take profits is a struggle for me right now, but I’m sure it is something I will develop as I grow and gain more knowledge and experience.
That being said, my $FCX trade triggered today. I bought 3 August calls, of which I plan to sell (or at least move my stop) at $29.00 for a quick profit. I will not play around with this trade like I did with $HD.
Let’s look at my picks from yesterday:
$Z would have been an excellent entry after 15min. You may still still be holding and trade down to the 100 MA
$GS short would have been excellent as well
$SLV you would not have gotten triggered in because it was not below the entry price
$CAT you also would not have gotten triggered
$LNKD would not have triggered. In addition, notice how we stopped right above the 100 MA. It will be interesting to see if we bounce or keep on going down.
$FCX You would have gotten triggered in. Let’s see how this trade plays out.
$PHM would really have been your call on getting in or not. Waiting for a close below support would be the best idea, though.
Picks for tomorrow coming soon!