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Thursday, June 13, 2013

Today's Closed Positions and Portfolio Rank

This post gives you some idea of what we were up to yesterday as the market was in shambles, it paid off pretty well for us today. From Wolf on Wall Street...

AMZN P/L and Portfolio Rank

AMZN was one of 7 new positions opened yesterday, all with double digit gains today except for AAPL which is at a + 4% gain. I mentioned maybe taking some profits from VXX Puts opened yesterday and I did go ahead and close the AMZN Call opened yesterday at 3:48 so there was about 1 day of market exposure. I believe yesterday was the day to set up most of these trades, but we found several today that looked good as well, in fact today's addition of the XLE call position is the top performer and for those who prefer to stick to equities, ERX (3x Energy Bull) was also in the same post (+5.37% today).  Here's the reason I decided to close the AMZN position.

 AMZN 1 min 3c chart, the green arrow is when the position was opened yesterday, toward the end of the day, like many stocks, the 1 min chart was going negative.

So was the 2 and 3 min as seen above.

I mentioned earlier that I suspect we get a pullback tomorrow in to a Friday Op-Ex pin (yes even the weeklies). I feel like the other positions were worth keeping open and letting them continue working next week.

AMZN's 5 min chart is still leading positive so there's more gas in the tank, my intention was to take the 1-day gain and re-open the position at a more favorable price.

Most of the other positions I felt fine with holding until next week when I think there's time for a more sustained psychological push to maintain pressure on the shorts and letting retail do the heavy lifting which is the entire reason for this set up since the SPX triangle.

The P/L...

At the $15.95 fillAMZN came in at +25.6% for a day.

As far as the rank, this again isn't bragging, this is a tracking portfolio, not a model portfolio. If it were a model portfolio the performance would be far better because it wouldn't be diluted by the number of longer and shorter term positions I'm tracking, but the point is sentiment.

The last sentiment update from the stream was earlier and the "Bulls" didn't want to buy, citing weak volume.  I know it doesn't make sense and it's not a blanket statement, but often short squeezes are on light volume until they hit a cluster of stops that are usually at some significant price pattern, support/resistance, whole numbers, moving averages, etc.

I think since the advent of HFTs, algos can keep a low volume, steady bid in the market ramping it higher pretty easily.

As for bear markets, the hallmark of a bear market is low volume, sure you have initial breaks and capitulation events, but on average volume is pretty low and you typically have nearly as many up days as you do down days, the difference is in that during a bear market, the bulk of the gains are made in a few single days with large moves.

On to the ranking, which again just goes to show where the majority of traders  were looking.

The weekly rank is actually 5 of 742, the red is the SPX's weekly percentage move.

The monthly was 18 of 1036

Most of these gains were simply from waiting until the right moment and hitting it, that was yesterday.

I'm not too concerned with tomorrow, I'm more looking toward next week, you saw those longer charts  of the Index Futures, those are some insane signals. Perhaps tomorrow we'll be able to enter some positions on a pullback; it's hard to say what the move will be, an op-ex pin? Keeping the pressure on the shorts? Throwing the bears a bone in which they think there's no follow through on a day like today, giving them confidence to "sell the rip" or short it as it were?

I'm going to take a close look at the internals and some assets and I'll be back with observations.

Brandt Uses Worden's TeleChart and StockFinder 5 Exclusively

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