I like to try and call tops and bottoms – but as all of you experienced traders know, calling the exact top and bottom and posturing your trades around that exact time tend to be losing propositions. (more…)
Market hedge – SPY Puts
Profit from Max Pain
Well the NFP number did what everyone expected it to do, showing some dismal employment figures. Thinking in the present, I think we are at a max pain point perhaps, and decided to go long the SPY Weekly May $138 call. Here are my reasons for that thinking: (more…)
Fade deadcat bounce in SPY into triple top resistance
Today we have a dead cat bounce running into a an area of resistance around $138.80 – $139.60. Note the bearish divergence in the Force index indicator, and the inability of the MACD indicator to challenge its previous 2 peaks at this price range. Stochastics are overbought, and Implied volatility is oversold. 2 indicators at extreme levels providing us a nice risk/reward scenario. My general outlook on the market is that we will be in a trade range until October, so selling this rally as it hits the top of a channel matches up with my view. If the SPY runs down to $135 before May, these puts should be valued at $2.96 or greater.
Market weakness calls for SPY puts
Looks to me like the market will head lower next week. Here are my reasons: (more…)