2008 HAPPY HOLIDAYS!

Just wanted to say Happy Holidays to everyone! Thanks for stopping by the blog this past year. The markets have generated a ton of oppotunities this year and hopefully you've made some money or at least learned some things along the way. If not, the new year is upon us so don't let any past mistakes bog you down. One of the worst things you can do in trading is dwell on a bad trade or missed opportunity. Learn from it and ensure that you don't repeat it.

If the past two days are any indication of the trading set-ups available until January 5, I'd rather sleep in and spend time with family and friends. Enjoy the holidays, stay warm and get some rest for the new year!

12/22 Daytrades

While I generally don't trust these low volume days for swings, the moves tend to be exaggerated which is good for daytrading. I started out using 5-min charts but switched to 15-min charts for entries and back to 5-min charts for exits.

SKF - I used the 113 level established early in the morning for entry and just trailed the stop using the moving averages and 5-min bars. I commented in one of the chat boards that the last hour is too volatile for the inverse ETFs and sure enough it was. I'm glad I exited a bit early.

SRS - I started the day on 5-min charts but got a false break-out early on.

I then switched to the 15-min chart and waited until it line up and crossed the moving averages before re-entering. Again, the last hour was a crazy so I'm glad to have exited a bit early.

GOOG - This was a slow mover but set up a very nice inverse holy grail off the moving averages. I liked the fact that there was a very narrow range to determine a stop level. I went with Jan 380 puts and managed about 5 points later in the day.

12/19 Daytrades

6:55AM - Bought some RIMM Dec 40's @ 1.20, bouncing off 5-SMA

7:30AM - Stopped out for $0.20 gain

8:00AM - Bought some SKF Dec 100 Calls @ 8.39, stop @ 107.00

9:05AM - Taking profits, sold SKF Calls @ 12.00

12:10PM - Bought SKF Dec 105 Calls @ 6.90

12:25PM - Stopped out of SKF @ 6.00

12/12 - 12/18 Day/Swingtrades...none

I've been on the road all week and haven't been trading. I dumped half my POT puts last Friday at the open for a double. I held the other half for a few more hours but POT was just too strong as the market climbed back so I closed out the 2nd half at break-even.

I'll try to post real-time trades tomorrow if I see any decent set-ups. As with other options expiration days, I'll be using at-the-money options on the usual, volatile suspects to take advantage of the minimal premiums.

12/9-12/11 Day/swingtrades

C - I sold the remaining shares @ 8.45 as C and the financials started to act week yesterday amongst the market strength

PCX - After seeing this break9.00+ a few times, I decided to close the position this morning for $0.75 on the Dec 7.5 Calls as the momentum appeared to be fading.

POT - I shorted this yesterday at 68.80 as it formed a double-top and took profits at 67.00.

POT actually printed a reversal hammer as it bounced off the 20-SMA on the 15-min charts.

POT - This has moved quite a bit from the low 50's last week. However, the 20-SMA still shows a downward trend. I took a low-risk short position with Dec 65 Puts yesterday around $69+ and added some more above $70 today. I'm going to take partial profits if it trades back down to $60 and trail the rest in case it retests the recent bottom in the low 50's.

12/8 Day/Swingtrades

In contrast to Friday, I didn't feel like chasing stocks after the opening gap. I went searching for low-risk stocks setting up a base. I picked up some BIDU mid-morning and got stopped out awhile later for $1 loss.

C - this set up a nice narrow range as the market consolidated the opening gap. I liken this to doubling down on blackjack. The narrow range allows me to increase the position size while maintaining the same risk. I sold half as the market began to stall out and carried the other half overnight.



PCX - Coal stocks performed very well today so I picked up some Dec 7.5 Calls as it appears PCX may be coming off a double-bottom.

12/4-12/5 Day/Swingtrades

I was hoping to get in on some short positions on Thursday ahead of the jobs report but got stopped out of SKF a couple times for $1 loss each and couldn't find a comfortable entry on the late day spike. I ended up in cash going into Friday.

On Friday, the early morning dip lost steam and it just feels like the bears are exhausted at this point. As the market decline stalled out, there were a lot of decent setups for long entries. I caught a decent move in AAPL and picked up a couple bucks in BIDU.

Next week will probably be similar to the past month with a long-bias. In this environment, technicals and fundamentals don't carry too much weight. I'll stay nimble and take profits quickly. If we get a rebound in energy, it may be good for a couple days as the sector has been obliterated. Check out the metals (X, NUE, etc.), many are starting to cross above the moving averages. On the financial front, C held has held up very well since bottoming a couple weeks ago so I'll be looking to go long again above $8.20+. JPM and WFC also look like decent long candidates.

In the long run, I think this is still just a bear rally. The fundamentals of the economy are still horrible and I haven't heard any plans that may pose a decent solution to the economic mess. If/when we turn back down, the inverse ETFs are still the way to go.

C - Thursday, I used the morning strength to unload my remaining C Dec 7.5 Calls. I made some decent coin on the first run-up to $8.40 from $6.80 but C hasn't moved much since and I didn't want too much exposure ahead of the job numbers. I'm going to use $8.20 as the next re-entry level if this rally has more momentum to it. C actually held up pretty well the past 3 days.

AAPL - I mentioned in one of the chat rooms that SKF/SRS did not look very strong when the Dow was down 200+points on Friday morning. I didn't want to chase any shorts so decided to look for low-risk long set-ups. AAPL based pretty well at the 89-90 level so I picked up Dec 60 Calls as AAPL crossed above the moving averages. I sold out aorund $92.50 as it stalled and re-entered a short while later to pick up another point. All told, a bit over $3+ on the calls.

BIDU - this was the same set-up as with AAPL above. I did a quick scan for stocks setting up a base with an easy stop-level. I picked up BIDU shares as the market started to rebound and closed it out a bit later for $2.00 profit. This normally would have been more but BIDU has been clobbered lately so I guess buyers weren't too eager to jump back in on this one.

12/3 Day/Swingtrades

Just a quick note, I'm still swinging those C calls. I've been too busy this week to monitor the markets so I'm going to put in a trailing stop in the AM. I'm going look for a decent setup to go short via some puts tomorrow ahead of the employment numbers on Friday.

12/2 Day/Swingtrades

These wild days are becoming the norm as the market is having trouble shaking off the selling pressure. The fundamentals are still horrible so keep those trades on a short leash.

No trades for me today as I was busy with work. I'm still carrying those C Dec 7.5 Calls. Looking at the intraday charts, the inverse ETFs are still providing some great daytrading set-ups. Easy with hindsight but I've highlighted some very low-risk spots that caught my eye using narrow ranges and moving averages:

12/1 Day/Swingtrades

That last hour of the trading day continues to be a daytrader's dream if you're positioned correctly.

FNM - With the market weakness, I unloaded all the FNM I had bought last week @ 1.19 when the stock closed the opening gap.

C - I wasn't as fortunate with C as it traded down from the opening bell. I'm fighting the tape here a bit as I'm still holding on. It's all time premium on the Dec 7.5 Calls so I don't expect them to go to zero anytime soon. I'll unload on the next rally.

SRS/GS - My timing was off today. I picked up SRS a bit too early @ 142.00 and was stopped out for $0.70 loss as the market tried to rally. I then switched over to GS only to get stopped out for $0.50 loss as the market cratered. I should have re-entered as the set-up on SRS looked even better but I had to head out to a meeting.