There is a bear eating up the flowers on the bull’s backyard. Henceforth, the flowerless green pasture becomes a little blanched. “Hey, there is a bear in the backyard!”
I was quite excited to see the SP500 recovered most of the after-hour losses of almost 15 points before the market opened. With an expectation of another up day, I was dumbfounded when the market immediately cascaded into a waterfall after the open. “This is not good!” I began to liquidate $AMRN and $CERS to raise cash.
As can be seen on the chart, the morning fall-off dropped below the 79 & 89 MA supports. This down leg was also confirming the formation of the 3rd lower high. Although the bull was able to recover some ground before closing, it closed below the 79 & 89 MA resistance. I’m seeing a correction that can easily become serious (or not) and the momentum swing seems to be leaning on the bear side.
Sensing a shift in the direction, I began to buy up $TZA and later $SPXU to short the general market.
$TZA did not look too good in the chart. If there is no further dropping, I may have to cut losses on this one.
$SPXU looked a bit better. At least, it closed higher.
You can see the symmetrical triangle being formed. If it break to the downside, I will cut my losses. If it breaks to the upside, it may climb above the 79 & 89 resistance.
$AMRN was quite strong while I sold my shares. So strong that I paused to wonder if selling was the right thing to do. But my desire to raise cash overcame my wanting to hold on to $AMRN.
Seeing that price actually stayed in positive territory in the latter half of the day, I decided to buy back 30% of what I sold. Let’s see what happen tomorrow. If the DOW continues to drop tomorrow, I may just sell the 30% to raise cash again.
$CERS was much easier for me to sell. Easier in the sense that I did not have any “wanting” to hold on to the shares. With general market correcting, I figured $CERS would drop faster due to this stock being heavily shorted. It is pointless to fight the current when the boat is inside enemy territory; hence, my getting out of the way pronto.
The chart doesn’t look good. Today big red bar could gain momentum to take out the trendline shown.
I’m impressed with $LRAD ability to ignore the sounds of the falling timbers.
The chart looks like it is just another normal day. One of these days when I wake up in the morning, I’ll see news that $LRAD has won a bid on one of the two large Middle East cities. That will be the day to watch some action.
Due mainly to losses from $CERS, my port gave back 1.85% for the day. YTD gain is now at 16.6%.
LRAD, SPXU, TZA, AMRN and 31% cash.
My 2 cents.
Categories: Daily trading Journal