Today is the day I waited for a long time, S&P500 down 2%. Too bad I was pretty much in cash, and I was caught by the market holding two call options in IWM and MDY. And the indicators I developed recently gave me sell signals. I acted on my signals.
- Sold MDY and IWM calls at losses. Both of them close to 43%.
- Bought SPY, IWM puts, once there was a little bounce, I bought another set of SPY puts, and DIA puts. Bought DXD.
- I set limited order to sell them. And all were triggered during the day when market accelerated the selling near the close. Too bad I left lot of money on the table.
- Since my indicators switched to buy towards the end, I bought SPY calls and SSO, just before the close. Even though I didn't sell the puts at the high of the day, I did buy the calls and SSO close to the lows. So it's not too bad.
- Let's see if the market can produce a bounce tomorrow, and I need to sell them tomorrow. My lessons on MDY and IWM, I could sell them at a small profit at Monday's open, I didn't. And I could sell them at a small loss before yesterday's close, and I didn't. Today I took the pain to sell them.
- The market sold off hard today, all sectors were down, and it's short term oversold. I expect more down side in the future, but short term, a bounce is in order. Let's see if I can get it.
- One thing new today, all the leading stocks got killed today, these "hot" stocks like AAPL, RIMM, GOOG,BIDU and AMZN. These are signs there are more to come.
- After hour, AMZN got good earning, after 20% in AH, let's see if it can lift the market. But AMZN is not at the same league as AAPL and GOOG. And tomorrow we'll have AAPL earning. If there are some bulls left standing, they'll use these news to lift the market.
- I think the big correction(10%+) is still ahead of us, maybe not in July or August, maybe in Sept. or Oct., since recent market actions are still very strong. That's why I'm playing two sides of the market now. Hopefully I won't get caught again.
3 comments:
Still enjoying your blog, just not too much to say as of late. I've been railing for a long time about how the sub-prime mess would bring the market down, but I wasn't in a position to take advantage of it yesterday. Oddly enough, it's some of the financials (such as BAC) that I think are the best bets long term (great dividend, anyway). Good luck today.
Thanks for your continued postings. They cause me to think about my own strategies. Yesterday I lost money on my silver and gold positions, although it was less than 1%. My position in DXD helped limit the losses.
The market has taught me over and over again that I don't have what it takes to pick market tops. That has been a brutal lesson. Now I have a balanced portfolio of long and short positions and mostly cash.
Once IBD indicates we are in a confirmed market downtrend, I'll commit more money to DXD, MZZ, and SDS.
David
Michael and David,
My recent trading lessons told me to pay less attention to FA, even TA won't matter much. I continued to read financial news and check charts. But I pay more attention to my trading issues:
1. I focused on the short for over 7 months, that cost me dearly.
2. I had poor money management.
3. I don't have an edge. I had my thoughts and ideas, but your guess is as good as mine. That's why now I started to develop my own indicators and patterns and used them lately for my very short term trades.
The blog is the summary of my daily actions and thoughts. I won't do FA and TA here, since there are lot of people doing that far better than I do. I may mention some FA and TA ideas. Instead, I want to record my trading actions, thoughts, success and failure. That's all.
So far, you see more failures than success, more lessons than good picks. But I'll keep doing this until I succeed or fail in the market.
Good luck to you guys!
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