Thursday, April 25, 2013

Update...

I got stopped out of my short position in $SPW right off the bat due to a morning spike triggered by an earnings beat by some company that appears to be related to $SPW in some way. Although the loss was small as a percentage of my account, I still got annoyed and some what upset.

Then $BCRX which was an idea of my watches from the previous night triggered a buy and I was "gun shy". After already researching the stock the night before and concluding that swinging it would be "safe", I started second guessing my self owing to the loss I had just suffered in $SPW. Before I knew it, $BCRX was already trading at $1.94. Since I'm not one to chase stocks, I let it go. The stock ended up closing at $2.01 up 11.67% on the day. What a miss!

Anyway enough crying over spilt milk. After today's close, the markets are now very over bought. Although we could keep grinding higher over the next few days, with the way breadth has been diverging from price, this scenario seems to be the one with lowest probability. I think its more likely that the market will move sideways and even likelier that they will pull back. So if putting on new positions here I'm leaning towards shorts. However, I must admit that the markets are and have been very tricky through out this rally. Since the markets are too over bought for new longs; I'd say the best bet for swing traders at this point is staying in cash and letting new longs set up in the coming days.

As a result, I have no ideas on watch for tomorrow. In fact, I'll be taking the rest of the week off to return next week with a clear head. All the best with your trading!

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