FOR MY BIRTHDAY I BOUGHT A HUMIDIFIER AND A DE-HUMIDIFIER
I heard the above line on a comedy channel on satellite radio the other day and could not stop laughing. Steven Wright one of my favorite comics used this joke. It reminded me of the stock market right here. I did say yesterday that we could bounce at any time and that we were at a short term extreme. I also said that we were in a rollover danger spot. Those were the two scenarios at hand. I did not think we would get a small down or small up day. I was kind of right, we got a big day up, but the comments were really not definitive, so no pat on the back for me. Now we see that we are in bounce mode. I do not expect this bounce to get too far. If we were to mimic the 1987 scenario, that would call for a sideways to slightly up drift for a couple of weeks, then a washout. What I think will happen is another day or two maximum up, then another move down. So I guess what I am saying, is that we are not going to mimic on a short term basis, what happened in 1987. I just was referencing that because it was in a prior post before the breakdown, as to why I thought a break was coming.
It is interesting to me that most commentators are just writing this off as an anomaly caused by the earthquake. Of course they could be right, but they are not even considering the possibility this could be the beginning of something more. I find that interesting to say the least. Even though I have my view on it, I also am considering that we could just move right back up out of here again upward. When you hear comments like that you know you are listening to someone who does not actually trade their own account. As a result, I just don't give much credibility to people that tell us how to do things they themselves cannot or do not do.
Alot is being made about how we broke the 50 period moving average in the indexes. I personally have not found that to be significant one way or the other in all the years of research I have done. However, the key to any tool of the trade is how you use it. With a Caddyshack type of approach, it may well be that a 50 day break mixed with the correct batch of other things might be significant. I do not know, and this is not something I pay attention to. The way I see it in simple terms is that my momentum oscillators are in down trends and the short term price movement is up against those trends. This to me is a short on the retracement setup plain and simple. If the retracement move carries up enough to change the trends, then I will look to go long. No Caddyshack analysis for me. I am bearish because my tools are, not because I have any grand view of economics that I am submitting for a Nobel prize. I will let them give those for Barry for continuing to do nothing. One funny comment I heard about Barry yesterday was that it was nice he took a break from playing golf to fill out his March Madness brackets.
Here is the GOLD trade I entered that I got stopped out of last night for a gain of $1300 per contract. As I stated when I entered it, I did not know if that big day was the start of the big one or not. I mentioned it was just another trade. I did manage it as such. I am hoping for another short entry in the next day or two here.
This turned out to be a marginal result, but we never know that going in to a trade. You just have to take them when they come along, manage them by your rules, and let them play out. I do feel that even though I could have taken way more out of this had I exited the first day, you are never going to make big money cutting short trades that start off gangbusters really quickly. For all I knew this could have fallen hundreds of dollars, we just never know. The only reason I am showing this is that I mentioned the trade setup the day before, took the trade that next day, and now show the exit. The purpose of this blog is to show what I do, so that is what I just did here. I will not ever show all the trades I do, just some so I can accomplish a couple of things.
1) Establish credibility that I know what I am talking about.
2) Show that I actually do trade and trade profitably.
3) Develop a following for those interested in my commentary and work and the work of my firm PNJ.
4) Develop interest for potential clients in the future for different things I might get into such as PNJ Advisors or the hispanic translation of it apparently by Robbins, PNJ Adviors!
Here is the latest standings and our hispanic version of our company ( I hope you get the sarcasm in that ). I am being hard on Robbins, they just made a typo and are in the process of correcting it.
So we are up 22% not great, but let me ask you how many other advisor firms do you think are sporting that type of return not even 3 months through the year?
Look next week for the website to be launched., PNJ Advisors.com
As for today, I expect an up close in most things but not a runaway up day. This should setup some sells for next week in several places. Good trading and have a nice weekend.