Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.
I've thought a lot about my TBT trade earlier this week, and I've considered why it made such a good trade. From a charting perspective, the risk/reward was really marvelous. The entry was good. The exit was terribly short-sighted.
My opinion is that OIH is similarly situated. As the chart shows below, OIH broke its uptrend very plainly, and it retraced back up to its broken trendline. A stop at 100.98 would be about as wide as I'd make it.
I'll start off with a minuscule bit of good news – I figured out how to make it so that clicking the logo sends you back to the Slope home page. A technological breakthrough! Anyway, some people have asked, so there you go.
I quite obviously have been getting out of sorts this week, so I dusted off my copy of Trading in the Zone and am re-reading it. I'm only halfway through at this point, but the main takeaways so far have been:
Good luck today.
Well, this pattern had a lot of promise, but it's dead, Jim.
So here is a broader view of the S&P cash market:
The bulls own this market now. For the bears to take over, the S&P would have to blow below this month's lows (around 875). The odds of that happening went way down over the past few days. 875 is very strong support, we can plainly see.
The huge yellow zone shows that there is very little in the way of the bulls ultimately being able to push this market to about 1,150. They will have to get past about 975 first, though (circled above), since that is the underside of a major broken channel. It also seems that every attempt to make a higher high does succeed to get a little higher, but then it starts faltering again (June 11th being the most recent example).
A lot of people have been writing to me about sentiment. I respect the value of sentiment indicators, and I generally agree that until we get to the point where the public is absolutely convinced that Happy Days Are Here Again, it will be very tough (still) to be a bear.
I just read the Elliott Wave Short Term Update, and they've pretty much thrown up their arms and have said an S&P between 1,000 and 1,100 is in the cards. From a big picture perspective, as I've said repeatedly, having the S&P in the quadruple digits in September would be a marvelous opportunity. My problem is that, frankly, I had such a blast trading between October and February, I got used to cashing in heavily on downsweeps, and I've been looking for them ever since. It's been an uphill battle, and it's exhausting.
Although lottery longs are getting more and more sparse, they are still out there. My 401-k hit a new high today, and that was even after I saddled it down with a big DUG and TWM position in the middle of the day. Rinky-dinky stocks that can climb double digits in one day are still out there.
I got stopped out of dozens of positions today, but I still have plenty of shorts out there, as well as some puts. It seems that the slow process of clawing my way back up the mountain has started again. But successful traders don't quit when things are tough. I'm going to be right back in there tomorrow, ready for battle.
I first want to apologize to my readers for my dour nature today. I'm kind of a depressive chap to begin with, and three days of the bulls pushing their horns into my eyeballs doesn't help my already flimsy spirit. So that's probably seeped through quite a bit, particularly today. Take note of the new logo.
But I hope you can understand. This week has been the worst three days of my trading life so far. I've slipped down 8% of my overall portfolio, and it's more demoralizing than I can say to have multiple weeks' worth of extremely hard work destroyed in short a short amount of time. Climbing my way up Profit Mountain doesn't mean anything if I'm kicked down into the valley so quickly.
The only trade I'm really upset at myself about, of course, is TBT. That was a really good long play, and I blew it. I really hope others made good money on that idea, because it was solid. But otherwise, the simple fact of the matter is that I was on the wrong side of the market in a very big way. I loaded up on shorts and puts all over the place, and the 500 point rise in the Dow so far this week has been agonizing.
I don't think I'll feel like uttering the words "head" and "shoulders" any time in the near future. That was a massive fakeout, and it really hurt a lot of bears. I'll do a little post later, but you can understand how it's a little hard to get excited about discussing charts at the moment.
It's nauseating for me to offer up some more "lottery longs", but it's the only thing working. My 401-k is at a lifetime high (and, errr, my other portfolios – as they kids like to say – "not so much"). So here are some items I'm buying and their stops:
BLC 1.67
CPE 1.36
EGLE 3.99
HERO 3.01
LBTYA 14.45
MEA 3.15
XING 1.59
ZQK 1.48
