Time To Adapt?

So there are some changes going into effect on the averages. Obviously everyone has felt the impact to one extent or another. The day is still young, but no matter how you look at this chart, the trend we have been used to for the last several months is changing.

Now what? If the market starts to get choppy, this means emotions are likely to start to flare up. If you are easily influenced by this demon, scale back your position sizes right now. Don't wait, and don't try to be a hero.

We've had the $TNX on the radar for weeks as a reason for the equity market to lose steam, and take a look at that yield! Want to diversify with some bonds? What about a savings account?

It is during these times that you'll probably want to shorten your time horizons, and perhaps diversify strategies. Since there was a request for exits, I will post a video later today with a few ideas of how to get out of profitable trade.

PS- I am not calling a bear market here, but the bull run seems overdone.

Recommendation: I should start a "red box" of videos here on the blog.

Long: AAPL

Short: The market

BTW- If I didn't make it clear, yes I do believe the market is changing. Not calling it a bear market, but a change is on the horizion.

Jeff,

Call me superstitious, but if you take off the red glasses, I will feel better. Please, just do it!

Somebody pleeeese tell me what is keeping CYMI up on a day like today. This is ruining an otherwise perfect batch of put trades I have going. Maybe that will teach me not to short a stock with good fundamentals. Lesson learned.

Thoughts on OIH I still have it above my support of 166, what say you option addicts

Thanks a lot
Grant

Doji girl,
I think that should tell you that it may not be a good trade. I took the CYMI trade when I thought it broke down a week ago and it came back up. I took it off my watch list. After three down days in the market, it should be down. Might be time to cut it loose.

Jeff,
That's what I've been doing since noon, scaling back my positions, taking some losses, taking some profits. Trying to get my account ready to manage. Looking at the DOW, I think it might be a trend reversal. Doesn't mean there aren't some strong stocks that are worth keeping and some that will go up anyway, but.....
GS, I think this is a great stock, but it is pulling down to long-term support and in danger of breaking that too.
What say you?

Randall and Michelle

CYMI support never failed. Look at a line chart instead of a bar chart. It never closed below support.

Just my opinion.

Brent in San Antonio

OIH

Sitting right at a diag support line. I see some horizontal support at $165...

I gotta second that Brent,

Why would you have traded CYMI yet? The entry signal on this one that was mentioned has never occured. What was the reason for entering?

If the market retraces, GS will hemmorage. I'd wait a while.

WOW did ya catch how fast Jeff changed the color of his glasses....

Bob

Thanks Bob it's sitting at my diagonal support as well, My question is they raised the price per barrel today shouldn't that make oil go up, just wondering.

Hmmm

Grant

Oh keepers of the Blog,

I want to be clear here as well. I too am still bullish and none of my postions have broken down yet. I do not neccisarily have to sell out of my winners that have pulled back a bit because of the overall trend is indicating a posible change?

Long: CROX,PKD,X,APPL,EWW,SNHY,MLM This Blog and The MarketCast

and GRMN - looks like I will have to exit aftert the close if nothing changes

Short: DKS, IYR, PFCB

Lot's of green yesterday a little more on the red side today.

Chin up, head high, positive thoughts, watching closely,

Cheers,
Arty

Thanks Jeff, I feel better now.

Jeff,
What do you mean hemmorhage? It is already bleeding badly. I own some stock. Scaled back my position. Gonna wait to see if it hold at 220. I'm not sure I understand.

Michelle

Bob, I hope you did not eat IT yet because I have the perfect fix - me buying puts on XEO or SPY...which soon as I did it started sideways. Hope they don't find out it was just a paper trade. Humor aside, I just watch Mike Coval's market commentary and he saw 13,350 and then 13,250 as support for the DOW and 2575 then 2525 as strong for COMPQ. So are we are holding above both which he seemed to think was health if we then get a bounce off support.
Grant I was thinking the same thing or wondering I guess.

GMCR (last I looked) was actually up 1.20. Now I wish I had bought more puts. I have 5 put positions (all doing well) but not able to equal my losses in the stocks and calls.



Michelle

In other words, if the market continues down, GS goes with it.

Whoo-hoo, it's a market rally. The DOW is only down 119 instead of 165 -- (that was a joke). Just trying to lighten up the day.

Michelle

Is there anything good that can come of GRMN?

I am right below my breaking point and I have plenty of time left but it is just not going my way.

Anything I am missing?

Cheers,
ARTY

Regarding GS - look at 2/20 to 3/06 ... when the market tanked .. so did GS ... I was in it on 2/20 ... got out with profit but could have lost my shirt had I not .... GS - in my view - is very 'market' sensitive ...

Just my $01.5 worth ...

Guys

Check out GILD it broke it's support of 81 looks good for at least Triple top confermation, thoughts on drawing a target.

Grant

Thanks Michelle,

I see google responing to your actions. Or Jeffs Glasses, not sure.

I am still in GS myself, profits or course eaten up, now on a tight rein.

I think Jeff has the Kevorka...stocks moving now that the glasses were changed. Jeff, throw some garlic around your neck!

GRMN

Don't know when you got in Garmin, but it is in my radar for a bullish trade if the flag pattern breaks out..

10 cents a day

It (PAY)s to play

Thanks Jeff

Jeff

With days like today do see that this is a great day to get into positions like
Bullish SRCL,MLM,POT,CHK,
Bearish UNP, CEG
some of these I'm already in, I just wondered if an experienced trader uses days like to today for there advantage instead of just batting down the hatches and waiting for the storm to clear. I don't want to be to agressive, but don't want to just sit here and wait.

What say you, thanks alot man

Grant

Jeff,
I took the trade on CYMI on June 5, 2 days ago when it broke below 39.50 and closed at 39.96. A close below 40 was my trigger. I'm still not sure I should bail because even though today is up, it is still within the pattern (though that could change any minute).

This comment has been removed by the author.

CAH looks like it might have legs.I'm looking @ MA for a short trade

I ate a lot of it today, addicts.

BUT, still all in all a good day so far. Yes, the market took a breather, I trashed another computer screen, even let some explicatives fly....

Coyote ugly the past few days for the bulls......Stick you your rules and trade your plan.

How has it affected my account..I have no idea. I don't bother with it until the charts tell me to. My trades doing as they should...hope yours are as well...

Karen,

Remember a breakout/down should be an event. It should be a noticeable shift in price, and most importantly, it is confirmed by volume. If you treat support as an area, not a number, you'll see the reason it hasn't dropped, it becuase it rally hasn't broken. Study that support line and you'll see what I mean.

GS

support line holding.....

J,
On your rally you may half right the VIX is falling the vix is falling - yippee! back down to 16 -

Sentiment maybe changing a bit as we head for the close??????

A

Jeff,
Thank you. I see what you mean. I jumped the gun on this one I guess. Trying to decide if I should close the trade for a small loss or see if it breaks my resistance line tomorrow which would mean the pattern is broken. So far, it is still setting up for a desc. tri. breakdown.

Bob,
Yeah GOOG is holding pretty well considering the market. I took my profits this a.m. on my June call, but still have July.
I scaled my GS stock position back to half what it was and watching it closely. I too looked at how it reacted in Feb with the drop.... whoa. I will get out if it doesn't hold the long-term support. My account is pretty slim now (trade wise).

Jeff,
Thanks for pointing that out about GS. Keeps me from being unemotional about pulling the trigger tomorrow if it breaks my support line.

Michelle

Karen,

The thing is...nothing is wrong with jumping the gun. What's wrong is jumping the gun in and then back out. With that being the case, looking back at the trade objectively, what was the purpose. You must realize that if you jump the gun, it is not likely to do what you want it to the next day, or for days to come. If you are jumpy on the entry, you can;t be as jumpy on the exit. Otherwise, the market will gladly accept the free donation.

Hope that helps,

Helped Me. Thanks Jeff

J

Hey guys,

sorry i've been out of touch today. been busy hunting and setting up some trades for this afternoon. also had to exit several trades.

Anyway, here are a few bearish gems for you to check out:

IMCL, CAL & SPF

Enjoy!

Jeff, yes that does help. I will stick it out until the trade is not doing what it's supposed to do. I see I still struggle with that thing called patience.

Thanks again for....everything you do for us.

Jeff

I think what I was trying to ask was when your playing price patterns how much does market sentiment or overall market movement play a part in your desicion making. Do you use your lines lines as the first overall line of defense or the last.

Grant

Not a good ending for the day...

Grant,

Not sure if this answers your question, and I don't mean to butt in..... I chatted in to Investools a question similar to yours one time, they told me that 75% of stocks follow the general trend of the market.

J

Sorry Grant,

I just went back and read your question..... I don't think what I said comes close to answering it. Apparently I just wanted to chat :o)

J

J

Thanks for the input, every little bit helps, always like to here from a fellow canuck

Lethbridge alberta baby!

Hey, I'm from Calgary! You're the closest I've found, except for Chris when he flies in.

Cheers!!

Jodi

Glad that I am in AAPL.

Only thing working today.

Did GS become the gutted sacrificial lamb over the past few days? I see spatter all over the place...and had to bail earlier today, the end of the day is even uglier.

Still holding onto:

Long: AMG, DECK and X

Short: HNI, PAY

Actually to be honest I'm from Taber

Corn capital of Canada.

But I live know in Pasadena, ca

Grant

Well addicts, the end of an ugly day.

Really ugly.

Let's see what tomorrow brings..

To be honest, I knew you were now in Pasadena, Liz has spoke of it before when she admitted to the beatings..... I mean kick boxing.

corn capital - there's bragging rights - eh?

Jodi

Jeff,
I know we have talked beofre about how we trade stocks and not the market. I am totally getting that now. I look at each stock and its support / resistance. I do have a question though about days like today and 2/27. When you see a reversal in the market trend, ( not just one or two down days) do you then give the individual stocks a little less room to run. Or do the lines which were drawn when the market was in another direction still hold?

WHEW, what a ride! Jeff do have any wine left over from last night?

$TNX all the way to 51.00, $VIX back to 17 on a screaming rise, everyone has probably seen the big board.

Would it be safe to say with the way it closed it is probably going to be a rough first hour tommorow?

ARTY

Jodi

Heh,Who doesn't like corn! Also Taber just got it's second intersection with a traffic light, moving up baby that's all I can say.Sweet!!

Bob

I guess ugly is all in percpective, ugly compared to my wife, definetly. Ugly compared to my mother in law, it's a toss up. Just kidding

Man I'm a gluttin for punishment, she'll be home any minute =).

Grant

Arty,

Did I wine last night?

Well not my type of day in the market but thank God for LCC, PSA and MSTR. LCC over 105% still could not keep up with the drag from the rest of my account. Back to 2/27 levels again but imagine what it would have been without diversification. THANKS more that you know for that discussion because I was 100% long until that day. Ok Pam did the LCC (I will never hear the end of this) as I think she may be the real trader in this house and I will just talk to my computer and place orders...
The TOS Shadow Trader said at close continued selling tomorrow at open for sure. Also VIX>18 bad news for Bulls. Who knows but that is his $0.02.

Profits to losses! I hate that. Who knew figuring out how to take home a winner would be tough. So much to learn.
I am thankful I diversified.
Great info on the blog today. I especially liked the ideas given on strategies to exit based on a timeframe.
Great stuff.

Yeah,
I don't know who mentioned GS up there, but it is at long-term support. If it breaks that, I'll sell the other half of my stock. Yuk. I also took some of my profits today. POT when from 1400 up to 400 (I think.) That bites.
Well, I know I'm not the only one hurting. I think the market may be turning bearish with a few up days just to make it choppy. I am not trying to predict negatively here, just bring to the attention of those that are still super bullish to be careful.

Michelle

check DNA for put.Look like we are going into a new phase but I am sure all is going to be well.Thank God for Jeff & fellow addict's word of wisdom & encouragement.No fear!
Connie R

Grant,

The day was bad
It was not pretty
As a matter of fact
It was pretty shi#$Y


Your mother in law
Are you implying
her looks are not
so satisfying?

Beware my freind
of mom in laws
you do not want
to raise their claws

So please beware
my good friend Grant
should she find out
you'll here her rant

And if she's ugly
and not really sweet
I can tell you right now
I have you beat!!!

Bob, I spent this time trying to think of a few funny lines, but I now conceid and bow down to thee. To shay, Bob, To Shay!

My condolences, on the in-law.

Actually my in law pretty good looking....LOL

So you think your in-law is hot, hmmm sounds like a bigger problem.=)

WHOA...HOLD YOUR HORSES

LOL

My wife is HOT, in law good looking....for an 80 year old lady I mean...

I will get you my pretty....

Jeff,
You didn't whine last night, I thought you had wine and cheese (after the masters talk of course).

May have been the night before.

Anyway God Bless diversification and wine.

Arty

Would I be crazy to jump into DVR long if it bounces off support at 15.50?

I have been looking or a low risk entry point (Stock).

I think I may need a little more confirmation. Thoughts?

Cheers,
ARTY

Did everyone go home to drink? It's so quiet.

I guess it's another beat down for Grant. Talking about my mom... well... I really don't have much to say. Both our mother's are kooks! Not ugly but they are a little crazy though.

Did anyone look at the after hours change on MSTR? It's up $2.41!

liz
pasadena, ca

Remember our old friend PSA?...
got in on some put a couples of days ago off of resistance bounce, Whammo... nice....

PAY....

A few more days like today and I'll have a Nice PAY day waiting for me...c'mon baby....

Phillip

Jeff (or any addict),

I've been at this for a while now and I do have a system, but I realize that there may be a better one for me out there.
I know you have to develop your own but can you recommend any good books that discuss various trading systems or how to develop one?

Thanks for the help

Geoff,
I have read "Reminisence of a Stock Operator" twice over the last 3 months.

It will not "tell" you how to develop your system but it will add some insight.

Try it.

Arty

Geoff,
I liked Stock Market Wizards. Not all of the interviews apply or are that great, but I got a lot of tips and ideas. I know Jeff and Eric all rave about Reminiscences of a Stock Operater, but I kind of got bogged down in some of the stock market manipulation about halfway through and to the end. Just my take on. Don't throw stones at me, you guys. That's just my opinion.

Michelle

P.S. I did a lot of taking profits and selling stocks today, but after the days' end, I feel like I should have done more. Oh, well. I am getting better at this. The first time it happened last May, I didn't have a clue what to do and was heavily weighted in options. Took a huge pounding. Didn't know how to react Feb. I think this is good practice, although, painful. Thank God, I had mostly stock plays.

What happened to the Market Cast of yesterday. I was not able to hear it and now can not find it. The 6/6 MC is today's on IT. What was the India stock that was suggested to be shorted?
I was planning to keep my stock trades and close out options that are breaking down. Are you closing your stock trades too?

Geoff
Trend following by mike covel is a good one. (not mike coval from investools)

Bob and Pam....there was some sort of glitch in the marketcast system, I listened to it twice thinking it was my internet connection.
The ticker Jeff and Eric talked about was IFN.


My new favorite rule to live by:
"All that we are is the result of what we have thought"
~BUDDHA~

Have a good night and a wonderful day tomorrow. I love this blog !

Thanks Tonya, are you going to play the SPX to the downside tomorrow?
I am tired and my brain must have shut down. What is the impact of a dividend with holding a PUT like on MNI?

Brett,
Do you have a list of stock sectors to play in a bearish market? I know Jeff and for sure Kelly have covered what sectors do well in a bear market. I started keeping a stock journal of ideas, but didn't put that one in. I am going to start trolling the waters for different sectors. Your help would be appreciated.

Jeff,
If you are up and about, this question goes to you, too.
Also, how do you take profits and scale out of bullish plays at the beginning of a bear market? I did a ton of it yesterday, but still need to do trimming today. What to keep and hold onto and what to unload quickly?

Michelle

Hey guy's, has there been a post on what to watch for when the market starts to turn? As an example, Jeff and Eric have been talking about the $TNX as a key point, and their analysis was SOOOO correct.

Jeff,
I am actually excited about where the market is going. I think this presents a huge learning experience on how to manage our accounts in a market turn. Hope you can help us learn through this experience with minimal loss and huge learning potential. I am an eager student ready to learn. So if you would like to tackle this topic, I for one, would love to hear your ideas.

Regarding Jeff's comment about jumping in and then jumping right back out. Here is my situation. I screwed up in every way I think. I jumped into COH yesterday around 10:30 when I thought it was retesting the support line for the inverted head & shoulder. Well, mistake #1 was to get into a bull trade in the AM without seeing what the market was going to do. I was "gambling" that since the market went down the day before it needed to go up yesterday. Playing those stupid odds. Well, anyways, I jumped back out at the end of the day with a loss since it didn't do as planned.

What would everyone do in this case? Was it a matter of jumping out too quickly?

Maybe someone else can learn from my mistake of "gambling" instead of waiting for confirmation.

Michelle,

I don't keep a 'bear market watchlist', but I definitely follow the sectors to see which ones don't look so strong. Right now, semis seem to fit the bill.

Denise,
I think it was a matter of jumping in too quickly with regard to COH. After 2 down days, with volume on Wednesday, you attempted to catch a falling knife.

I think the market might turn up today based on the improving futures that I see so I wouldn't be rushing to dump long positions just yet. Unless the trend or pattern is broken.

I am tempted to put on some long trades on strong stocks that are at support but I will wait to see how the day plays out. I don't want to be stepping in if Monday is going to be another Black Monday. (I'm old enough to remember what happened in Oct '87)

In any case, today should be interesting.

Doji Girl,

Are we reading the same futures? Go to www.cnbc.com and then click on the "Markets" tab. Go down and click on "FUTURES". Every one is showing down. Go to Prophet Charts and look at $TNX and you will see that it has gapped up again today and is presently at $51.58 or 5.15%. Based on this information I would tend to lean toward more of another bearish day instead of a wishful bullish day. My $.02 for what it is worth.

As a few OA's have already pointed out, this recent market has been a great learning opportunity this past few days.

Our losses should be looked upon as educational expense and a set up for even more successful trading in the future.

What's fantastic is the support within this blog, The Marketcast (last night's was yet another example of great insights and thoughts from the Master's E&J), Investools, etc.

Lose a little, learn a lot, make a bundle.

Bring on the bears if that's who will be coming to the party! The table is being set for whoever arrives and wants to stay late.

Steve K.

Hey everyone,

Just want to say let's not jump the gun too quickly on calling this a move to a bear market. I think Jeff was pretty clear on that yesterday. Something has changed but it doesn't necessarily mean that we're heading down huge today or even next week. Bottom line is that right now at this point, the market has no clear direction. It was trending up but stopped yesterday, but it hasn't started trending down yet.

My approach on getting out of trades has been to exit the ones that failed, or anything that was a winner that had met my target and was showing weakness. But I'm still in trades that held their support or their trend and haven't met my target yet. I also tried to get my call/put ratio a little closer to even at the end of yesterday and got myself more into cash so i can setup for whatever is coming.

On taking new trades from here -- with volatility way up just remember to plan risk to give your underlyings a lot of wiggle room, otherwise you'll just keep getting stopped out and taking losses. Jeff alluded to selling spreads around 2/27 and again yesterday. I'm planning to use this period of higher volatility to do a little selling, smooth out the movements and pick up some premiums where I can.

I agree with whoever said this is going to be a great learning experience (unless of course the market just springs back into bullish mode, which i think it doubtful but possible)

Re the futures, at the moment they are down again. I first looked at them at 6:30 this morning, they were down. At 8:00 they were up which is why I posted what I did. Now they are down again. Like I said, today will be interesting.

Denise, I am so there on jumping into trades too quickly. I did a few of those in the past few days. Generally speaking, once I recognize that I got into something prematurely, unless it just instantly goes in my favor (which almost never happens, usually the opposite), I will just get out and take the loss and chalk it up to a blown trade. Better to take the loss and say "I just spent X dollars to learn that lesson" than to have it hanging over you day after day because you're still in it. It's like being in something with too big a position, it's all you can think about. Got to get rid of those.

Re Futures:
Here is where I get my info from. I look at this at night before bed and it shows what is happening in Asia. It updates itself constantly. It's also the first thing I look at in the morning.

http://www.cme.com/trading/dta/del/globex.html

Denise,
I have done that too, and watched my loss grow to a bigger loss. I think if it is just a SHARP correction and it holds today, the market could head back up, or it could plunge down and be a bear market. Either way, getting out was probably smart if it wasn't a good play to begin with. I had some good plays that turned downright ugly yesterday. They even held through the first two days of correction. So I am not sure what Jeff would say, but taking your losses quickly is part of staying in the game.

Brett, what sector would that be, trucking??

Michelle

Karen, I was there in '87 also. This doesn't have the same feel. The long bond went to 10%, the dollar was much weaker and the the yield curve was different.

The shape of the yield curve has been sending kind of mixed signals for the last year. All that has happened now is that it has a positive slope. This is what the Fed wants and is ultimately good for the banks. With a positive slope then they can cut rates and the banking system can benefit. You know paying people low rates for deposits and lending at higher rates. The yield curve is what has hurt the banks and real estate.... For a sustained S&P rally you need the financials to participate.

So my vote is no to '87. Just my .02. But if it happens you can make a lot of money.

Jamie

How do the glasses change color...wow.

Jamie

Futures are back UP for the moment... Like doji girl said, should be an interesting day.

Maybe we can get Jeff to switch from the 'blues' to green lenses...maybe that will help our cause!

READY SET GO

GOOG bounced right off the $510 support line this morning, may be a good entry..buyer beware..

Thanks to all for the help with the "jumping" into trades issue.

I tended to do that alot before I started reading the blog faithfully a few times a day. I would get scared as soon as it started going wrong. I have learned a lot about patience and the most important lesson learned - I have listened to other addicts talk about taking 1 option. This has helped more than I can say. It has taken the stress out of my decisions. I can look on objectively and when I make a mistake it is not enough to kick me out of the trading game. Yes, it is hard to see a "small" profits even though the stock makes huge moves but..... it is easier to see "small" losses when it goes wrong.

Thanks to all of you. I feel as though I am learning so much.

Good Morning All,

If you are a fan of the H&S pattern, I dont think it gets much cleaner than PEG. Breakdown was yesterday but today is providing a re-entry.

Stephen

Bob,
I don't mean to be scary, but if you have got several contracts on GOOG, I would take some profits off the table. I think this morning could be a fake-out. I hope I'm wrong. I cleaned up my account and am ready for Bull or Bear, but I waited for CME and GOOG and such to bounce around to either sell at a profit or small loss. I am sitting in stock and puts until I see further confirmation about where the market goes. All the economic news certainly points to a bear market coming. Just be aware.
That's just my take on this

Michelle

michelle,

semis are semiconductors.

Michelle, I did just what you did it appears with just puts and one stock. Looks like VIX is dropping, semis up...I know more data than I know what to do with it so I am pretty much on the sidelines. As Jeff said cash is a position.

Yeah,
I'm with ya. The $TNX is up again today. I kept some small positions in some strong stocks. I sold my CME (because my husband insisted) and because an expensive option in a volatile to bearish market is dangerous. Don't know if I have the skill to navigate.
Who knows what the right move is. At least I'm not nervous about what the market does now. I have enough positions to participate in a rally or a bear market.

Michelle

Michelle, your "what sector would that be, trucking?' comment is the funniest thing I have read in long time. Thank you:)

stephen

I had to step out, wanted to maintain my 50% gain level so I am sitting in cash right now to see what happens next week and what approach to take on various stocks.

When is the next Fed announcement on rates? I think they will hold which will cause a rally, but that is speculation of course and could be a while.

Hope everyone is fairing well after the past few days, and if you have lost money(as I have), just remember it is only money and you will have many opporunities to make it back.

Ben

To my recollection the next Fed meeting is June 27/28.

Although I think the consensus now in the market is that there will not be a rate cut this year, so that is being figured into the current market.

If there was a rate increase, that would likely not be well received by the market at this point...maybe somewhat later in the year is a possibility.

I too am concerned that this is not over and personally expect further declines next week.

Sitting in CA$H is good, although I'm still in some positions, hoping to eak out either some additional profits or limit losses a bit more. Got hammered over the past couple of days, although not as bad as previous corrections, so that must mean that I'm learning something. >:-)

Thanks to all on the blog for helping with that!

Stephen,
Glad to bring some levity to the last few days. Trying to learn all the lingo.

Ben,
I think that is a smart move. Hey, if the bulls rush in and push the market back up, maybe I miss a bit of the move, but I'd rather miss part of a move than to get crushed by the bears if I'm wrong. Gonna go back and check my notes on what Eric said the other day of indicators to watch and see what that tells me about economic conditions.

Michelle

GRMN rules.

____________GREAT SCOTT!!!____________

A guy goes away for a few days and look what happens! I whish I'd been able to bow out of a few trades yesterday and get some cash to work some new trades in... depending on the market. Most of my puts have buffered the fall nicely, but are now at the bottom of their channels and looking to me like they're ready to bounce. Hmmm don't like that. All my calls, on the other hand, are at the bottom of their channels and looking ready to bounce up. What's a guy to do?

I can't possibly catch up on all the blogging over the past few days. I feel like I'm being left behind. A "has been." An "ex-blogger" (as opposed to an "X")

My youngest daughter graduates from grade 8 this year and I'm cementing branches in pots today to make trees (PLEASE don't ask... it's a long, convaluted story that won't make anyone's life better for the telling.) Then I get to build an Eiffel Tower, which will be 12 feet tall. Don't wait up for me.

PCU's at a great entry point. Thank goodness for holding on to PFCB.

Eric said FXI below 105 (It's at 115), FXE below 132 (it's down today), TNX above 4.9 (done that and up today). Dollar up.
I can't figure out the symbol to pull up the U.S. Dollar I had $DXY, but it is not recognizing it.
What is the symbol to check the dollar?

Michelle

For what it is worth...the $TNX traded at a 5.25% over night on huge volume. Then had a vicious bounce higher (lower yield). That appears to be the bond vigilantes line in the sand for now.

GRMN is playing nice. So is MCD (much lower vol).

Jamie

You know, I just sat down and went over each of my trades and not one of them is asking to be released. They're all at support (on the call side.) So for once in my life I will follow my rules and not bail out until they close below support. If it doesn't work... I will hold my breath until I turn blue (that cheering sound you hear would me Catherine. No honey, it doesn't work that way. Once I pass out I start breathing again.)

C&C-

Sounds like some projects I did in high school. A night in Paris. It actually turned out pretty cool. I hope that your projects go as well for you.


Michelle-

I hate to admit this but I was a little confused as well when Brett said "semis". The first thing I thought of was trucking.


I got out of most of my positions today as well. They all finally hit their exits. I'm still in a few that are doing what they're suppose to. I feel pretty good though because compared to February I'm doing a thousand times better. I'm just going to wait and see what happens next. I feel like I don't know enough just yet to do anything in a changing market.

Did anyone get their INVESTools DVDs yet? I just got mine last night via FedEx.

liz

X is setting up a nice bull-flag. If it is too pricey for you (like it is for me) then check out SID. Target #1 would be 55.02 - a huge move. As of this moment, there is a bullish harami forming.

Brett, did you get in on the IMCL and SPF you mentioned yesterday? They are retesting but look like gems like you you said. Thanks.

Stephen

Take a look at VRGY. IT is also setting up as a bull flag. What is also nice on this one seems to be its resiliency to the last few days, adn during the Feb drops. This may be a good bullish one to hold as we now start to look for possibly more bearish plays.

Anu

I have a question probably for those "seasoned traders" (those that have seen lots of these events and learned how to successfully weather them)...

With a market turn like the past few days, whether a "correction" or possible trend change, do we continue to treat our positions like we would on any other day or if stuff is falling like a rock from outer space like yesterday, do you just bail to preserve capital?

I guess I'm wondering that this type of action is somewhat artificial and may not accurately reflect what the stock will, should or would be doing. Does that make any sense?

Yesterday, I was planning to hold until the end of the day as I've finally taught myself to do (most of the time), although when Jeff wrote:

"If the market starts to get choppy, this means emotions are likely to start to flare up. If you are easily influenced by this demon, scale back your position sizes right now. Don't wait, and don't try to be a hero."

That last sentence really hit me...ah yeah...I'm no hero in this stuff! :-)

When I read that, and as the market continued to drop, I figured okay, let's get out of positions that had broken support. Otherwise I would have held until the end of the day and taken even larger losses.

I did keep several positions that are still above support/below resistance as appropriate.

Someone yesterday mentioned that maybe Jeff could offer a Post to address what to do in a dramatic market shift like the past few days...that would really help a lot of us.

Jeff,

This quote seems to tie into what you often say about finding your own trading style.

"If you want to succeed you should strike out on new paths, rather than travel the worn paths of accepted success."
-- John D. Rockefeller

Just a view with a slightly different touch.

Take care.

Chip:

Just be careful, selling and buying does not happen in a day or two. That's why there is the terminology dead cat bounce. On the last drop it took about a couple of weeks of volatile trading to see where the market was headed. Although this time around there are many more factors showing bearishness.

I think we all knew that the market was over extended and now people are taking profits.

If I can be of any help, do not try to be a hero, wait and let the charts tell you what is going on. A lot of professionals will sell into the strength so be careful

Last time around the 3 wave theory played out exactly.

I just can't see how they would move the markets so much and start buying again like nothing happened

Liz,

What DVD's? For what course? Haven't heard anything about new DVD's. Could you enlighten us all?

I'm not trying to sound like a permabull here, and believe me i have my bear gear on, but let's try and remember a few things:

1) the overall trend is still up
2) markets don't shift gears instantly
3) corrections are part of a bull market, and believe it or not, they are necessary for moves higher
4) pessimism adds fuel to the fire. When everyone is bullish, the bull has run its course. Clearly there are worries out there about everything from earnings to interest rates. That's actually good for the market.
5) The 10 year is high and rising, but on a long-term trend, it's fast approaching resistance. Don't get suckered in by the media, who make it sound like rates are over 7%.

Just my 2 cents. It's wise to get some good bearish setups in your portfolio, but don't shift too hard. You could miss out on another retest of the highs.

Anonymous-

Sorry I wasn't clear. A little while back people on the blog were asking if anybody had received the DVD's from the Orlando Conference. That's where the DVD's are from.

Good thing I was able to PAY for POT.

liz

Chip,

I don't bail unless my trade goes bad. Yes, I may give up profits during the pullbacks, but as long as I have time left and the trade is doing what I expect it to do, I stay in.

For example:

X...still in it
GOOG.. still in it

Until thye break my support area, and as long as I have adequate time, I let it do what I expect it to do, make higher highs and lows, and my support lines hold...

Also, I prefer to take a trade as close to a support/resisatnce area as possible. I have the luxury of trading all day, so I can try and make better entrys, which has helped me to minimize losses on trades gone bad.

I bought GOOG today bouncing off $510 bounce. I am willing to risk a close below $510 for a possible run up as I see GOOG at support there.

Will it hold? Don't know, but that's a risk I am willing to take.

Aslong as your account is diversified, you can better weather the pull backs.

Brett,

Glad to see your back buddy!

Ditto on your post.

There are lots of great looking stocks sitting at support right now and I am tempted but I think I will wait til Monday. For one, I don't like buying options on Friday. Also, this isn't much of a rally. Could be a dead cat bounce or could be the market catching it's breath before it makes its next move. I'll probably unload one or two trades that appear broken and just sit tight until Monday.

Some GREAT trade opportunities today:

JOYG - perfect retest, huge cup and handle

GSF - at 2 levels of support

CMG - looks like a bounce.

And on that note...i'm off to get a burrito. First one of the week. You know what that means?

Brett,
You're too funny. Good to hear from ya. Lots of good stocks to enter, but I think I'll wait too and let the market settle down.

Gotta go grocery shopping.


Michelle

DavidS, Brett and Bob Raimo,

Yes, I'm being fairly conservative, not trying to jump in/out of positions unless support/resistance is broken, watching the charts, etc. The volatility nailed me fairly well in Feb and I recall it did take 2 - 3 weeks for the market to settle back into a good trend.

Basically, if my remaining positions maintain what I expect I'll hang in there and if not, I'll exit profit or loss.

Once in CA$H, I'm tentatively thinking I'll stay there to see how things shape up. I'd like to be able to get in and catch moves either way as Brett suggests, although if I do, I just need to be very careful and keep my positions smaller than I usually would.

Brett, what you stated above makes logical sense and basically is what I've been thinking as well in my non-seasoned experience! Although by stating as much, it helps at least confirm that I'm not completely daft. Thank you!

I still have a couple of Bearish plays, one of which is PAYing nicely!

Bob Raimo, Thanks on the specifics, that helps too. So you do still view each trade individually even though the entire market took a dive. I had gathered as much from C&C a couple of weeks ago and have been maintaining that view. That provides confidence to continue what I'm doing and feel that I'm on the right track.

I'm still in AMG and X, waiting to see what will happen, not happy losing unrealized profits, although understand that it has to do this in order to go back up.

Again, thanks to the three of you for your well respected perspectives, I suspect they will be appreciated by many!

Something is happening to X!
Went from -2. to plus $5 in about 20 minutes!!

DG,

Hadn't noticed...I didn't think Steel could catch fire quite like that! Impressive!

Jeff has started a new post

Ummm...is there something wrong with my computer...it's showing that X is now up $7 - 8+ for the day...

What in the world is going on?!

If it's real, it must be a gift from the Market Gods for hanging in there!

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  • I'm Option Addict
  • From Saratoga Springs, Utah, United States
  • I am a professional trader and an instructor for Investools. I've had relations with the markets for 9 years. Born in Concord, CA, but reside in Saratoga Springs, Utah. Father of THREE, Husband of one.
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