Wednesday, April 29, 2009

04/30/08 Market Recap

FOMC promised and FOMC delivered, one of my personal rules is to not trade during an FOMC day or to do so on a very limited basis. So this morning instead of picking up two long I closed out two of my short positions. Over all not a good day as my shorts were up more than my longs, I also got stopped out of my EEFT short. The US dollar also took a big hit as well. For the last month lot of people have been saying this market is overbought and it can't go up anymore, and yet it keeps going up. We never broke the confirmed uptrend that we have been in, and i'm kicking myself for not noticing the obvious trend and instead trying to pick the top.

The SPX hit the key level of 880 that I have been talking about practically in every post for the last 10 days, todays high was 882 from which it immediatly went all the way down to 869 and ended up closing at 873. That was an amazing shorting opportunity as it was a covergence of a fib fan and a 23% retracement, I didn't take advatage of it as I was busy at work. This will provide some fairly good resistance if we come up against it again, a break through 880 and a close above will be very bullish. I would love to see this market go down as I see many good shorting opportunities and it will give me a good chance to load up on some longs. But in this run up we have blown through every resistance level, so it might do the same with 880 and that 10 handle down move was all that we're going to get.

New short position: AIT

New long position: STZ

On a side note, I got out of my CAVM long a few days ago, they just announced earnings after the close and are down 8% after hours. I had a pretty decent profit and I decided to take it because there was too much risk going into earnings. Earnings are equivalent to russian roulette in our current market, when I am swing trading(as opposed to buy and hold) I try not to hold equities over earnings. Of course it can go the other way as well, but I don't feel the probabilities are in my favor so I stay away from it.

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