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…)
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…)
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.
Looks to me like the market will head lower next week. Here are my reasons: (more…)