Labman.. market is a fluid place, hard headed approach glued by super ego is carpeted in and out by these very same markets, we comment on markets on daily basis, we don't have the luxury of Accompora who opened his mouth that DOW's goes much higher and next day we slipped, for us we are looking at those good opportunities where we use options to get into a stock and wait for the come back whereas based on option we play SPU positions so as to make profitable trades on both sides of the markets. I think that is how we need it here, positioning in right stuff, identifying right indexes and getting in and out of them. Day trading with consistency is a very difficult profession. I have this big picture about ultimate trust on the model, than I have these smaller variations where I try to fit in my short term objectives within the long term movement of the market. That is the difference between a correction and a bear market like Nekkei fall from 32000 was a treacherous bear market. US markets big moves in July 96, Oct 97 and Oct 98 were great movements solid sell offs within a uptick trend. My approach is to maintain that fine line where I keep an ultimate trust on the direction of hte market, but would hate to look like a fool when market moves through my supports. These supports were my old resistance's when I called for 1130 all these guys were calling for 550, when I gave this 1280 target they looked at 900 and when my target was 1440 they were looking at 1130, so slowly and gradually they are following me higher, but it is fun to make money to 1440 and than enjoy the ride down. I am extensively trading on this pattern until I have a clear direction. In new economy the systems are not going to break away what has been right for last six years and proven good for the market will continue to help the market, however like the 550-775 band in 96 and 7770-900 band in 97 asnd 990-1130 band in 98 within a huge move we will get these corrections those who think that market opens every day to move higher have to move on to Vegas or Atlantic city.
In markets we need to move on news and momentum but the core direction which is to pick good stocks at cheap price has to be practised all the time. . This is what I do every day pick good stocks outisde money calls six months out and trade indexes using your options on stocks as long positions.. I have done well and will continue to do that.. Leverage is the name, one S&P option gives you a long cover of 250,000 $ and one put also gives you a protection of 250,000$, a set of these options if you pick the right direction pay off in one trade enough of premium that offsets the premium paid on long stocks. |
