The market looks weak right now, and this drawn-out, essentially sideways action just reminds me of the action last summer. The possibility of a new low, lower than the the one put in from November, remains in play. However, we're entering a crucial period, as major events such as the inauguration and talk of further government intervention solutions to the economic problems means the market can break hard either way. If we get an Inauguration rally, I would use that opportunity to take some profit and possibly buy some puts on the indices; recall how strong the Election Night rally was, and how that marked a peak in price that we still haven't gotten above.
We sold SMN Friday; as expected bullish short-term strength meant the optimal time to sell had past. On a rally I'd recommend booking some profit on our new holdings, perhaps at the market close on Tuesday.
| Current Holdings | ||||||
|---|---|---|---|---|---|---|
| Ticker | Basis | Closing Price |
Perf. | Sell-Stop | Additional Exit Guideline | Chart |
| MR | 21.81 | 20.91 | -4.1% | 19.99 | Consider booking some profit on strength | Chart |
| BEAV | 9.07 | 9.07 | 0 | 7.99 | Consider booking some profit on strength | Chart |
No trading Monday, MLK holiday. For Tuesday, a couple long ideas that might work out for a short, 1-2 day hold, and in case we get an Inauguration Day crash, a short, but a holder.
| Ticker | Entry | Exit A | Exit C | Chart |
|---|---|---|---|---|
| LCAPA (Liberty Media (Capital)) | 5.76 | 5.12 | 4.62 | Chart |
| AEO (American Eagle) | 10.63 | 9.69 | 8.99 | Chart |
| SH (Short S&P 500) | 79.23 | 75.32 | N/A | Chart |
Please refer to "How To Trade The Ideas" (right-hand side) to read this table.
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