Long S&Ps
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Started by joj - Aug. 12, 2022, 8:32 a.m.

All the fundamentals say we should be going down.  Hawkish Fed, weak earnings, inflation, Russia/Ukraine.

But the market keeps rallying on good news and shrugging off bad news.  But by far the most bullish thing is that every talking head on CNBC's Fast Money show last night said the rally is over extended and due to turn lower.

That's good enough for me.  I am long from 4188 with a stop at 4172.

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Re: Long S&Ps
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By tjc - Aug. 12, 2022, 11:42 a.m.
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  Totally agree with long term assessment.

  HOWEVER, a vicious 1 or 2 day drop to enthuse the Bears and whipsaw recent buyers is NOT out of the question!

  BUY the dip!

By joj - Aug. 12, 2022, 1:59 p.m.
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tic, 

A downward swoosh is certainly within the realm of possible scenarios.

Here's a stat I read today:

Since 1950 the market has rallied back over the 50% retracement of a bear market decline 20 times.  In all 20 of those rallies the lows were not revisited.  We are trading above that 50% level (4231 S&P) as I type, but need to close above it.

Of course the fact that such information is finding its way to my eyes is itself a contrarian indicator to fade.  :-)

I'll be out long before all time highs.  This is a trade, not an investment.

By tjc - Aug. 12, 2022, 2:19 p.m.
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joj

  Amazing stat!

  Are you suggesting that there will be no or very shallow dips?  If so, a trader must "just close your eyes and buy"?

  Or do you favor a quick whipsaw?

  EITHER WAY, new yearly highs ARE coming?

By joj - Aug. 12, 2022, 8:34 p.m.
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I have no strong opinions beyond the coming 2-3 weeks.  It's a momentum trade for me.  Market is inflicting pain on the bears right now.

New highs are certainly possible.  I could also imagine a bit of sideways action over the next 6-12 months.  The Fed balance sheet will accelerate its unwinding starting in September which should be a headwind going forward.

Next stop is the 200 day moving average.

By tjc - Aug. 13, 2022, 8:22 a.m.
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  AGREE----------4340 here we come!

By metmike - Aug. 14, 2022, 1:21 a.m.
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Thanks for the good discussion!

Re: Long S&Ps
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By joj - Aug. 15, 2022, 9:05 a.m.
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Sell stop is at 4203.

By tjc - Aug. 15, 2022, 11:04 a.m.
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  Closed eyes near 10 am (central time)-long Q

By joj - Aug. 17, 2022, 6:18 a.m.
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Moving stop up to 4240.

Small options traders still buying puts, but talking heads tempering their bearishness.

Market under pressure over night.

Re: Long S&Ps
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By joj - Aug. 19, 2022, 6:56 a.m.
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Stopped out at 4248.  60 points profit is ok.  Unfortunately I left 80 points on the table.  The price one pays for going for a home run.