I have covered my entire PWRD position this morning on a trigger @ $28. I didn't think it was going to go that low but apparently it went to $27.40 at its lowest! But judging from where it is now I'm glad I locked profits. No one ever made a dime being greedy in this market. The stock is bouncing off its 20DMA on big dip buying programs kicking in. But to be honest, the way PWRD chart is setting up makes me inclined to short it again. It is recovering right now from the lows and about to hit the 50DMA with the technicals near maxout. I'll decide what I want to do.
I mentioned the Oil fund etf USO in my post yesterday and today that trigger kicked in at $100. EXACTLY where the USO topped out not a penny more. It doesn't get any better than that! Going to ride it for probably 5-6 points.
-DL
Edit 1:
I've thought long and hard, and for now I'm going to release my apple position. There is nothing wrong...except it has just simply made too big of a run to a point which I cannot ignore the potential downside it may have. At its highest apple hit 188. If Apple has a 50% Fibonacci retrace from it's low of 115 hit during this year, that would mean 188-115 = 73 points / 2 = 36.5 points pullback possible. Meaning 188-36.5 = $151.5.
Which matches exactly what the charts show
Necktie support EXACTLY at 150 from 3 year perspective.
Am I being too pessimistic thinking apple will retrace that far? Maybe...but Apple has made a very big move up. It's just not realistic to keep expecting it to keep going up without any profit taking pressure. With its indicators near max out in the short term plus my belief the markets will continue to correct, I wouldn't be surprise if I could pick this back up again in the 150's. So I will do the discipline thing and book profits. I will be back.
Disclosure
Long GOOG, V
Short USO
7 comments:
Looks like the S&P is holding around 1400...there may not be a breakdown...what bad news is left?!
Can you really consider AAPL breaking down when the data you're using was due to a market crash? Since the whole market tanked during the 1Q of the year, I don't see how you can say AAPL could break down using those lows. I'd say you could use that theory more if the market was healthy and only AAPL tanked. Everything sold off, lots of cash out there...
monkies,
I see where you're coming from. Of course nothing is ever for sure but it is indeed my conjecture that after the massive rally the markets enjoyed the past 2 months it is only healthy for markets to correct. The longer it doesn't correct the harder the drop will be. (the opposite is true also). If the last half year have taught us anything it is when hedge funds and institutions unload we as individual investors will not be able to leave the table without a signicant chunk of profit evaporating or sometimes even lead to losses. This is why I just go by what the technicals paint because I believe business media are full of lies. And time will tell us the news to come. But I'm just thinking from an unbiased point of view. I think problems as massive as defaults and credit crunch are issues that takes time to resolve. I'm not sure whether 6 months is long enough. So that's why market movements imo will be at the mercy of its natural technical pattern.
and also one more thing. I am purely a technical trader since the timeframe to my trades are relatively short. If you are long term hold guy then ya I'm sure your theory will eventually reward you. I am just more interested I. Short term movements and I pay more attention to technicals over what business media reports
xman.
can you share your goog pick with us. i got in today.
bassman,
I think google should settle around $560 that is where strong support is.
Hi XMan
Every time when I check you blog, I find a Cramer's pick (last one was USO). Very interesting.
I found your strategy at:
http://www.investopedia.com/articles/06/madmoney.asp
Please take a look. I agree with you and the post.
Where do u think the Dow or S&P will bottom?
I'm guessing 12300 for the Dow.
Still looking for a good entry point into V/MA, but I don't think its time.
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