12,543 is the mid=point of the year long, 1,331 trading point range we have see. May 5th we were at the Top and Goldman Sachs released a report saying that Stocks were a “buy of the century”:
June 4th we traded to the low of 11,884.
It’s June 22nd, and for all intents and purposes we start getting into Summer Vacation Mode where a lot of traders and money managers pull their horns in one way or another and look for only massive moves of 2 or 3 standard deviations away from an average move before they get involved.
That makes for thin markets and choppy action.
Was anyone rally surprised that the banks were downgraded? Where where these folks in 2007 and 2008 when these credit swap default unregulated derivatives where being proselytized as the best thing since sliced bread? They were too busy watching power lunch and Pinnacle on CNBC, if you ask me.
I continue to believe that the stock indexes should be avoided except to put on counter trend positions at the extremes of the moves. Day trading should be avoided, unless its an unemployment number or the day before the Fed is set to speak. That might give enough volatility and trade to justify the risk.
Right now, any trade has to be looked at from risk reward ratio very very carefully. Precisely because we are in thin summer markets.
We had a 4 day weather market in the grains. I exited all my august calls here today for decent gains. I was looking for a really good rally to exit on, but the wheat and corn had trouble holding rallies today. Lord knows there will be plenty of opportunities in the next few weeks to get some trades on. Just have to be patient.
I would want to be short SX here against 14.00 18 times in the last 8 months this level held and then we got at least a dollar break to cover for winners.
I also like selling WU against 7.00 level. Nice round number to fade.
Just make sure you are ready to lose money and have a buy stop in place the minute you are short. These markets are choppy and unforgiving.
Have a great weekend.
CER
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Contact me directly at christianrobonson1@gmail.com if you want a response to your b.s.
Dear Anonymous,
Contact me directly at christianrobinson1@gmail.com. If you believe what you wrote, you are woefully mis informed.