LG,
Right on all counts...
The short answer is a combination of option trader tendencies to firstly always look at both sides of the picture but have the real focus on the short term and therefore swapping back and forth as to which way I think things are going. And secondly to LOOK at the long term to decipher the implications short term.
Here is some of the reasoning which got you the "position" changes you mention:
- (BTW it is the DIRECTION of the 200 day MA of the VGY and not price compared to the MA) Around mid-July, the direction of the VGY 200 day MA went south. That is a defining moment for me! It says we are now in a "bear" market, whatever that means and we should be getting lower and not higher.
- On August the 5th, I saw what I thought was the "bottom" of the move downward based on a number of things. Remember, it takes the 200 day MA a while to turn, so if you can spot the chart pattern for the bottom of a move, you have a leg up on the 200 day MA. I suggested that we had seen the low and in fact, THIS week we put in what APPEARS to be a double bottom on some of the indices, including VGY.
- the strength of the move down on the 11th plus the Prez's problems with his zipper led me to the conclusion that if the Prez doesn't get out of this thing unscathed, we might just break the double bottom and THAT would be extremely bearish. In addition, we have all kinds of trend line support in the markets, which, if broken, tell me it is a long way down. So I published my concern that if we didn't hold at around the lows here (probably 8100-8200 level min), then we could see 4,200.
To summarize my "position" which really is just a collection of my thoughts over the past 10 or so days, it would be this:
1. We are in a down-trending market;
2. We have seen some evidence of a bottom;
3. If the double bottom breaks down substantially, the markets are in deep doo-doo.
4. Until VGY 200 day MA turns up, the threat continues.
Now in the don't do as I do, do as I say category... I got into ASND calls which, had I paid attention to my own words, should have gotten back into BA puts... THERE'S where the money could have been made!
BWDIK?
Clear as mud?
Bill |
