Monday, July 6, 2009

Updated Targets


Looking for the small blue rectangle to be touched either today or tomorrow. Will use that as a guide for now to exit hedge and add more shorts with higher leverage.

19 comments:

  1. got more SSO here @ 24.27 ... looking to close out hedge with break even.

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  2. doubled SSO again at same price.

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  3. not enough volume to drop this below current level. At least not now, will distribute first and go up a bit more before taking out the LOD.

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  4. closed out all of SSO with a small loss. Keep in mind it was not meant as a trade - purely as protection for my shorts over a long weekend. Whenever I enter a hedge I try not to turn it into a position and close out as soon as possible. Yes I expect more upside today and possibly tomorrow but not trading the long side unless its a scalp or daytrade.

    For now, staying 100% short and still very underinvested. Will be adding SPY put calendar spreads soon, also adding more to cash positions for SKF and SRS.

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  5. Today we may see 873-866 range then a bounce tomoroow to the levles you have indicated. though, we may not see spx above 900. Likely spx target could be 820 before a major rally.

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  6. 899 is my new target for adding shorts as mentioned above. I think you may be right that we will not get back above the 900 range. Market has built up a nice 10+ pt buffer now to turn 900 into proper resistance.

    We should see quite a bounce off the 852-854 levels though, probably will bring us back into the 880-890 range if we do break the 880 with strength here.

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  7. That is exactly the scenario I have in mind. today at the close early tomorrow will be a good long entry for a couple of days of rally. real low will be around thursday close for a profitable long entry.

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  8. chaugsy let's go put some sizeable positions on. You're still trading scared!

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  9. hah ... if I have learned one thing from this rally its patience and being cautious. Yes in one way it may appear scared, but I look at it as overly cautious especially at such an important point here.

    "Real" money will be added soon. But I am not going to try to chase it here. I do believe that we have seen the top at our 960 levels (its ironic that it happened 4 days after AAPL made its high - as you remember I was very strong on this indicator).

    Now that I have a nice enough buffer built up I can go in a bit stronger without having to worry about carrying a drawdown. Out of my 100 positions, only 10 of them are in the reds (3 stopped out with minimal loss) - so feeling a bit better.

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  10. FYI - I do not like shorting into oversold conditions on the 60min. Thats kind of scaring me a bit here to add higher leverage.

    I will give it my first try at the 89.73 SPY level today. Staying cautious still as we can run this all the way to 912 SPX this week.

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  11. 912 may be a long shot but not before 875 is broken. added some puts at 895 for day trade only.

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  12. 912 only if we get it from here, if we break 880 we shall not see 912 again - or all bets are off =)

    I do think we have room to run this to 912 here. Of course perfect short but the market has shown that she will not let us bears get a piece of the pie.

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  13. I'm still holding onto the UNG pain. It's broken the 52 week low. What are you thoughts Chris?

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  14. Ryan, that was my fear here with UNG as it is being dragged down with oil and dollar. UNG in itself is a good play - however its getting too much outside pressure.

    Not really sure what I would do here. its quite oversold so it maybe a lucky bounce in the cards. However if the dollar gets more strength as I am assuming it will, it will put pressure on nat gas and oil. The only "luck" again is an oversold play - but those I would only do in small positions with tight stops.

    Is UNG a large position for you? Ask yourself, if you had no position today, and you had the choice to take a UNG position. Would you do it? Maybe a nice play with a stop just below the low of the day. But again, careful.

    Sorry :(

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  15. Here is what I would do if I had to take a position.

    Avg 12.53
    Stop 12.30
    Limit 13.62

    That's a nice range to play and possible if we continue to rally.

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  16. Thanks for your advice Chris. At this point even with a bounce, I won't be able to break even b/c I bought into the leveraged version and I'm suffering the decay right now. It's a fairly large position and if I didn't have a position right now, I would buy in right now but I don't want to over expose myself which I probably have already. But if it continues to take dump like this, I will be forced to put in another large position since I still believe there is more upside potential than down. But what do I know, I've been thinking that for the past couple of weeks now :( BTW the volume is pretty amazing.

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  17. only advise I can give ... do not average down on a loosing position. This may not be the case here for UNG. But think about it. When you took the position, did you consider it would make a new 52-week low? So the trade changed, it was not what you set it out to be. One of my quotes I used to have up here "do not get married to a loosing position". A mistake I have made many times in the past.

    Trading is not easy, otherwise everyone would be doing it. However, we have to go into a trade with clear plans and clear confirmations. I assume a new 52-week low was not one of those confirmations. I am not saying to get out, but take what you have learned from UNG - and apply it in the future.

    The greatest learning lessons for me have been from loosing positions - the BEST ever, have been on positions where I lost a LOT of money. The more money I have lost, the better the learning experience. Take that as a positive. If you do end up in a bad trade, try to walk away with a bruised eye, but not broken legs.

    In the mid term, I see a lot more downside for the entire commodities sector, short term wise - I am unsure as the dollar is still not quite with a trend yet - but once the trend is in - you NEED to be on the right side of the trade. The past 2 months we have had the luxury of getting out of bad trades very easily - this will not continue to be the case as we move into summer.

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  18. Thanks for your advice Chris. Unfortunately I let emotions take control and now I don't want to let go and take such a huge hit. I'm just hoping for the best, and you're right, I really did think the bottom was in and wouldn't have thought it would make a new 52 week low. I am still learning and if I did have a stop in place, I wouldn't be suffering this draw down.

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  19. we have all been there. Trust me. what does not kill us makes us stronger. I am sure you will not make that mistake again.

    Keep in mind, there are ALWAYS opportunities in the market - just be patient and wait for the right time.

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