If the market's true to form (always a big if), then we just got the type of sharp correction that'll be followed by an equally sharp rally soon afterward. And what day should be up next but tricky Thursday. Chances of a reversal get a boost from that alone. If you want to buy the morning pullback, be aware that it may turn out to be more than a pullback. All the positions that got stopped out today closed lower, excepting FCX (which ended up trading lower after hours anyway). Buying them back on the pullback, at prices lower than those at which they were sold today (risking to their initial sell-stops), is a tempting idea. The only thing is, buying closed positions back without a setup based on strength is just not a long-term winning strategy. It's also known as revenge trading. Whether you do so shall depend on how much you believe that today was only a test and not an omen of further downside to come. If we get a lower close tomorrow, then further downside becomes the more likely scenario.
We did buy one of yesterday's trade ideas, THO. It gapped up and then traded down to the closing price. Chart looks pretty good though.
| Current Holdings | ||||||
|---|---|---|---|---|---|---|
| Ticker | Basis | Closing Price |
Perf. | Sell-Stop | Additional Exit Guideline | Chart |
| THO | 18.63 | 17.76 | -4.7% | 16.98 | None | Chart |
Tech has been stinking of late. The fact that tech is not leading the bull charge is a bad sign. Or rather, it's just further evidence that this is a bear market rally, and not the beginnings of the next big 20-year bull market. So I'd avoid tech stocks.
| Ticker | Entry | Exit A | Exit C | Chart |
|---|---|---|---|---|
| NRG (NRG Energy) | 25.01 | 23.23 | 22.25 | Chart |
| BVN (Compania de Minas Buenaventura) | 15.41 | 13.99 | Chart | |
I currently own shares of BVN.
Please refer to "How To Trade The Ideas" (right-hand side) to read this table.
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