I sold the stocks I bought Thursday afterhour (CHK,AGU and WFR) and sold them Friday for a decent profit. No, I didn't sell them at the closing high, I sold them way too early, when S&P around 760, not 800!
- I'll continue to hold some of the stocks I didn't sell, mainly POT, MOS, MEE and KOL. I greatly reduced MOS and KOL, as a result, MEE I think is the biggest holding(which I sold leap calls to collect the premium), followed by MOS,POT and KOL. I think I may just hold to them and sell covered calls from time to time, specially when there is a rally.
- Most are in cash. I will not move them all in like I did during Oct. I shall only move all in when market fall to 600 level or move too fast into one direction, then I will fade that direction.
- So far this year, my quick trade are profitable, and my investment(buy and hold) is as bad as it gets! Therefore, trade this market is not a bad idea.
- I will using some ETFs to bet long or short. Don't put in large positions.
- Now is time to be careful.
- Based on market's reaction to Obama's victory, I think this rally Friday on his economic team should fade away quickly. Yes, it's great we'll have change, but hope is a 4 letter word, don't bet on it.
- Watch C, JPM, and commodities. These have to go up in order to long this market. From the price of C, JPM, USO, ^TNX, ^VIX, I can see what smart money is doing, they have no confidence in this market, therefore, every rally should be sold. Unless it's proved otherwise!
- If we have a black week, down to 600 level, I will be aggressive buyer.
- That's the plan. I will adjust according to what market is telling, not what my plan is or what my prediction is.
Recent trades and lessons:
- I bought some EEV and puts on Thursday and sold them at the end of day, for a decent profit. I sold EEV at 126, and it closed at 95 on Friday. Very risky!
- I bought some calls at the end of Thursday and then again on Friday, and I was panic at one point since market was down, sold some small positions at loss. Then, instead of selling at loss, I added more calls when market was against me, then when market finally took off, I sold at great profits. My best result in a few months. I still sold too early, when market was around 780, but a profit is a profit.
- Now I think options can kill my account quickly, so only use it when it's extreme. Like Thursday's selloff and Oct.10th's sell off. Otherwise, it's unwise to use options. Just use 1x ETF. Then 2xETFs. Now we even have 3x ETFs. Turn aggressively when it's extreme.
- I learned lot of things from poker too. It's better to play solid poker all the time. But you have to have gut to go all in to take a stand! In the end, it's the heart that defines a winner!
