Working Off The Overbought Condition

**These are my thoughts on the SPY ETF in my Daily Trade Ideas which includes many, many more charts and setups.  Subscribe to my nightly Daily Trade Ideas on the right to see the rest of this letter.**

“It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.”  George Soros

A strong day that started with a gap open but markets faded in the end.

We still need some rest after the large run that has taken us into overbought territory now.

I’m seeing some leading stocks start to move now and it is perfect since leaders are meant to lead.

We’re looking great for a nice run into the end of the year.

We can make our dough for the year quickly if all goes well.
It has been a tough year to be sure but staying with a high cash position and not getting chopped up has us ready to pounce as soon as we get the all clear signal which looks to be close.

It really is extraordinary how much money you can make in a short amount of time in the right market if you have the patience to wait for it.

SPY October 24, 2014I’d love to see SPY come back to test 192 to 190.

We are looking great, I’ve just got to wait for this overbought condition to work off and for a new pattern to complete before going heavy but it’s closer everyday!

Have a great evening.

Warren

Pulling Back On Schedule

**These are my thoughts on the SPY ETF in my Daily Trade Ideas which includes many, many more charts and setups.  Subscribe to my nightly Daily Trade Ideas on the right to see the rest of this letter.**

“The game is my wife. It demands loyalty and responsibility, and it gives me back fulfillment and peace.”  Michael Jordan

We’re pulling back a bit now right on schedule after a big rally off, what is so far, lows.

We should see some nice buys develop in a couple or few days and all we have to do is wait for it.

SPY October 23, 2014SPY is pulling back nicely so far.

A move back to 192 is about guaranteed and a gap fill to the 190 area is quite likely and a great area to get a trade going as things stand now.

Of course if things worsen and the 190 area can’t hold then we are in for much more downside but I don’t think that scenario will play out, but we must be ready and accept it if it does.

A little more patience and then we can start to reap our rewards.

Warren

 

 

Strong Gap & Go Day For The S&P

**These are my thoughts on the SPY ETF in my Daily Trade Ideas which includes many, many more charts and setups.  Subscribe to my nightly Daily Trade Ideas on the right to see the rest of this letter.**

“I’ve failed over and over and over again in my life and that is why I succeed.”  Michael Jordan

Another gap open that left me out.

I totally did miss hitting the low but the stars just weren’t aligned.

Sometimes you get them, sometimes you don’t.

We should now see some consolidation and this coming dip should be able to be bought.

SPY October 22, 2014After this huge run we do need some rest.

It’s nice to see the low is now most likely in and now I’m waiting for some good solid setups which could still take a couple weeks.

We’re on track to end the year strongly.

Have a great evening.

Warren

A Case Of The Mondays

**These are my thoughts on the SPY ETF in my Daily Trade Ideas which includes many, many more charts and setups.  Subscribe to my nightly Daily Trade Ideas on the right to see the rest of this letter.**

“Always turn a negative situation into a positive situation.”  Michael Jordan

A very quiet day with low volume.

Not really much to say tonight as we are in sit and wait mode.

They do say the 42nd week of the year tends to be bad and black monday occurred at this time of year.

I’m not calling for a black Monday type of day this week but markets certainly are on shaky ground.

SPY October 21, 2014SPY is moving above the 200 day and the 190 area which is good but it is doing so on very low volume, or with no conviction.

I’m still not convinced a low is in place and I may well be wrong and missing this so far decent trade but the risk reward is just not there for me at the moment.

A case of the Monday’s for the SPY and most stocks today as they looked alright, but underneath, they weren’t.

Keep it real out there, and real safe!

Warren

Weak Markets Give Strong Rallies But They Don’t Last

**These are my thoughts on the SPY ETF in my Daily Trade Ideas which includes many, many more charts and setups.  Subscribe to my nightly Daily Trade Ideas on the right to see the rest of this letter.**

“Confine yourself to the present.”  Marcus Aurelius

A strong Friday to be sure but weak markets do tend to give sharp strong but very short-lived rallies.

I still do not see this as being a low but that can change.

Most stock charts are still a mess so cash remains king.

SPY October 20, 2014SPY had a huge day but did gap higher and I was in no mood to take a trade late Thursday and risk it.

I do take trades at the end of the day once the daily bar is near complete, but only in select situations and I have not seen that situation appear yet.

A move above the 200 day and 190 area with volume and on a closing basis would be good and I may reconsider my stance then but as I said, so many charts are very broken and need time to give us safer entries.

Enjoy your weekend.

Warren

False Bottom Girl

**These are my thoughts on the SPY ETF in my Daily Trade Ideas which includes many, many more charts and setups.  Subscribe to my nightly Daily Trade Ideas on the right to see the rest of this letter.**

“Because a thing seems difficult for you, do not think it impossible for anyone to accomplish.”  Marcus Aurelius

A decent day for markets but I am still skeptical of a low being place.

While many people will call a low after the last two days, it is false from my learnings.

Stocks remain very dangerous but can be good for day-trading.

Small sizes and the ability to be very quick and use tight stops is key, otherwise sitting in cash is the thing to do for the moment.

It is earnings season and we always have to be aware of when a company reports and reduce or exit the position before they report but there is not much need to harp on about that yet since cash is king.

SPY October 17, 2014SPY has a 2 day bottom setup, at least that is what many would have you believe.

The proper reversal has to close on lows the first day and then close on highs the next with the bars being equal.

What we have was two closes in the upper half which tells me it’s a trap.

We may form a large range here before moving lower again from what I see tonight but that can change with tomorrows action.

Be very, VERY careful if you must trade or stay in cash.

I went for a splendid drive today on a low cloud warm fall day with leaves in full colour and then a nice walk along the calm bays of the island and just enjoyed life a bit for a few hours mid-day.

When it’s busy, I’m office locked but when markets are junk I try to get out for some exercise and relaxation.

Of course I’m listening to some business podcasts and keeping an eye on the markets and news with my iPhone all the while but getting out of the office is important when we can.

We are so blessed to live in this day and age with phones and internet capabilities so take advantage of it!

Warren

Bloodiest Of Bloody Days

**These are my thoughts on the SPY ETF in my Daily Trade Ideas which includes many, many more charts and setups.  Subscribe to my nightly Daily Trade Ideas on the right to see the rest of this letter.**

“If you don’t have time to do it right, when will you have time to do it over?”  John Wooden

A wild open lower like we’ve rarely seen that continued in one of the bloodiest days I can recall.

We did bounce very well into the close and may now have a low in place but the damage is severe at the moment.

I’m not super keen on jumping in right away but perhaps in a day or two once I see how the action plays out.

I did buy a small position in VSR today which is up nicely so far but risk is off on my book for the most part meaning very small positions if any at all but that can change quickly.

SPY October 16, 2014SPY bounced well but damage is severe and until we do form some sort of chart that points to higher and/or we move back above the 200 day average things can remain very ugly.

There are definitely times I will take trades late in the day or once things do begin to turn but for a true turn to come I need to see a follow through the next day and with such blood in the streets I am waiting this time.

I did consider some SPY calls later in the day but with volatility spiking large that made the options too expensive and risky for my taste.

We don’t have to catch every turn, rather the meat of the move although I’ve been known to hit tops and bottoms pretty closely sometimes.

With NFLX off some $120 on earnings tonight it shows just how dangerous this market is.

Be very careful and remember that cash is always a positions and at times like this it is the best position.

Warren