As the above charts shows, twice before the S&P has done a 24-hour hover above the bottom channel line before launching toward the top of the channel. A break of Friday's low would make a logical early entry into a short position: far enough from the lower channel line to make it a true break of the channel, yet close enough to the current price to make it aggressive. The trend of the past two weeks suggests that it's slightly more likely the market continues up from here into the 1100s. For Monday we're keeping both possibilities in mind.We sold MPG and a half position in SSO on Friday, both for a decent profit, although MPG gave back quite a lot of gains.
| Current Holdings | ||||||
|---|---|---|---|---|---|---|
| Ticker | Basis | Closing Price |
Perf. | Sell-Stop | Addl Exit Guideline | Chart |
| SSO | 32.68 | 36.38 | +11.3% | 34.99 | N/A | Chart |
If the market should continue up from here, a marginal new high next week might be all that the bulls can hope for. In the late stages of a rally, I like to play high-beta/junk/momo tickers like MPG that can run far in a short amount of time, so that'll be our long side focus. We'll also be prepared for a break to the downside and the possibility that early Friday morning marked the high of the bear market rally.
| Ticker | Entry | Exit A | Exit C | Chart |
|---|---|---|---|---|
| PAL (North American Palladium) | 3.11 | 2.96 | 2.92 | Chart |
| CPST (Capstone Turbine) | 1.44 | 1.32 | N/A | Chart |
| AONE (A123) | 24.31 | 22.79 | N/A | Chart |
| SVA (Sinovac) | 8.58 | 7.92 | N/A | Chart |
| FNM (Fannie Mae) | 1.56 | 1.45 | 1.41 | Chart |
| SDS (Ultrashort S&P 500) | 38.31 | 37.49 | 37.24 | Chart |
| SKF (Ultrashort Financials) | 24.37 | 23.45 | N/A | Chart |
| GLL (Ultrashort Gold) | 11.71 | 11.44 | N/A | Chart |
Please refer to "How To Trade The Ideas" (right-hand side) to read this table.
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