Slope of Hope Blog Posts
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After the market closed today (Monday), I saw on my news feed that Verifone Systems (PAY) had agreed to be acquired at a huge premium to its closing price, about 50% higher than the market. That’s not especially interesting news to anyone that doesn’t have a position in the stock, but I do. And it’s a short position. And that, as you might guess, is not a good thing.
I am sharing this bit of bad news as an object lesson in risk management, however. Because after I found this out, I asked myself the following questions and gave myself the following answers: (more…)
As you might guess, today (Monday) was pretty much the opposite of last Friday for me. Friday was awesome. Today sucked. But as a swing trader, I’m not going to cover all my positions willy-nilly. As I so often say, the individual stops need to take care of themselves. As such, I’ve retreated from 71 positions down to 61. Of those, 51 remain profitable, and the other 10 have small losses. Average of the winners is 3.27%, and the average of the losers is negative 0.26%.
This bounce could have more life to it (and, for me, more pain). Looking at the charts, it seems to be the key is the gap between last Wednesday and Thursday. Take a look below, and you’ll see an interesting correlation between the 100 day moving average and the Wed/Thurs price gap. It seems to me, that makes a sensible bounce target. (Side note: I took this snapshots about an hour before the close, so the price moves were even higher).
It was nine very, very long years ago that we reached an important milestone in the history of the market: the fabled “666” bottom of the S&P 500.
The inability of the stock market to hold a downtrend more than two days is driving me insane (again). It has been two years since there has even been a drop off lasting a couple of weeks.
It was just a month ago that we were in the throes of an all-too-brief bout of excitement. But, looking back, it’s evident that 90% of the move was confined to just two trading sessions. Yep. That was it. For two years of waiting, we got just two days of glory. The next morning was a panic low, and bang, we were back into the unending quagmire.
If you had asked me a week ago what I thought the probability was that we’d resume the downtrend and take out the lows of early February, I would have probably said 80%. Last week’s action (augmented by this morning’s) takes that down to more like 20%. It seems that, once again, the BTFD crowd was right. It sucks.
Oddly, the big tumble early in this month took place on pretty much no distinguishable news, and the same can be said for the recent lift. Let’s face it, the Dow has gone up thousands of points in just a couple of weeks, and no one can point to any real reason why. It’s pretty much like the “V-dip” didn’t need to take place at all (except to wipe out the unfortunates who owned XIV). (more…)
After this morning’s “insta-dump” of everything, the markets have utterly and completely turned around. That’s not great news for me, but let’s just say I don’t have any regrets about not being super-short (to say nothing of the fact I sold my QQQ puts yesterday). The ES has done the following about-face:
I’m going to start with a tale from about 180 years ago. In the early 1840s, a religious leader named William Miller believed the second coming of Jesus was foretold in the Bible with mathematical accuracy, and using a myriad of verses and tidbits from the Bible, he sought to compute as closely as possible when exactly J.C. was going to come back.
At first, he didn’t offer anything very exact:
Using an interpretive principle known as the day-year principle, Miller, along with others, interpreted a prophetic “day” to read not as a 24-hour period, but rather as a calendar year. Miller became convinced that the 2,300-day period started in 457 B.C. with the decree to rebuild Jerusalem by Artaxerxes I of Persia. His interpretation led him to believe and promote the year 1843. Despite the urging of his supporters, Miller never announced an exact date for the expected Second Advent. But he did narrow the time period to sometime in the Jewish year 5604, stating: “My principles in brief, are, that Jesus Christ will come again to this earth, cleanse, purify, and take possession of the same, with all the saints, sometime between March 21, 1843 and March 21, 1844.” (more…)