Sunday, July 06, 2008

Trading Plan and Clarification

Trading Plan:

My watchlist is small this week. Probably as small as it has been all year. However, I may take some of the biggest position sizes I have taken in quite some time (while still managing risk appropriately). Here is the list:

I am monitoring leveraged index long ETFs such as SSO, DDM and QLD. While I am already long the S&P via SSO, I may add even more to the position.

I am monitoring high flying commodity stocks as shorts on a bounce. Sectors of interest include coal, steel, ag and energy. I went long DUG on Friday, which is a leveraged energy short.

I am monitoring financials and may short stocks such as MS, LEH and GS on strength. I went short LEH on Friday, but only took a small position as there is still more room to bounce.

That's basically it for the watchlist. I almost feel like I haven't done enough work, but this is really all that interests me right now, and I feel strongly about my current market thesis.


I have received many e-mails about my recent comments with regards to the expected bounce. A few seem to think I am predicting a market reversal. If I've lead any of you to think that is my market thesis, let me make myself clear. I am only positioning myself for a market bounce. I am not predicting the end of the downtrend. In fact, if we do get a bounce and it nears resistance, I may establish short positions in the indexes.


Kevin H said...

The coal industry has been strong up till last week....I look forward to tomorrow's trading session.

Ryan said...

is it time to buy POT? what about the rest of the aggs? Love your blog - keep up the good work