Outsmarting the Market

[antioch6]

They say you can't make money timing the market. This thread will help me figure out if that's true and why. Buy and sell decisions will be based on a short term time frame (a few days or weeks). 15% would be nice but there are no targets here. Technical analysis will be used to place stop losses.

First trade will be based on what I see in the stock, gold, and silver markets. I'm looking for a sharp rally in the stock market and a pullback in gold/silver. According to my magic charts, the overall indices should hold today's low as well as the 20 day moving average and rally 5-6%. Large caps and technology should lead and I want to be in some individual names. I bought QLD yesterday with this trade in mind, and today I'm looking at AAPL IBM CSCO INTC GOOG SNE as potential buys. AAPL has the largest upside on this rally, while INTC looks it's due for a snapback and this could be a good low. GOOG has a clear technical support at this level so it would be easy to find a tight stop. CSCO has rallied alot and might not have the potential upside in the short term. IBM has been bouncing off this 185 area for months and rallying back up to 210. SNE is my Japanese play if the Nikkei is ready to start it's rally again. SNE should open higher tomorrow so today's low is a reasonable level for a stop. To sum it all up these are the setups:

AAPL stop 455.00
IBM stop 186.00
CSCO stop 25.75
INTC stop 22.25
GOOG stop 879.00
SNE stop 19.8

[antioch6]

Bought GOOG 879.25, INTC 22.449, SNE 20.119 tight stops on all of them.

[Lucavia123]

Bought GOOG 879.25, INTC 22.449, SNE 20.119 tight stops on all of them.

I bought SNE today at 20.09. I think it has some nice upside potential and it is sitting at a nice support area. Great pick!

[antioch6]

I got stopped out of GOOG and INTC, and decided to sell SNE because of weakness in the overall market indices. With such a tight stop on these stocks, it was very easy to get knocked out in less than a week. Going for large short term gains with a small stop doesn't feel like a good combination. I'll stick with my other strategies and leave this for the genius and the insane.

[antioch6]

Time for another crazy short term trade to outsmart the market. Looking back, my idea was decent and my stops were good. The market just decided to breakdown. Maybe this time will be different...

I'm trying to short the market this week, anticipating a 6-9% move lower over the next 6 weeks. Going after the inverse ETFs with some stop losses. To spread some risk for a rally, I'll enter half my position tomorrow and another half later this week or next.

SRS 1.3%
DUG 1.3%
SKF 1.3%
SDS 2.6%
DXD 2.6%
TWM 2.6%

My stop loss is around a 3% rally in the S&P.

[antioch6]

SRS 23.648
DUG 62.26
skf 22.126
SDS 38.128
DXD 34.40
TWM 16.188

[Deaddog]

I'm trying to short the market this week, anticipating a 6-9% move lower over the next 6 weeks.

What leads you to anticipate a move down?

[antioch6]

I guess it all comes down to a hunch. I don't really have any value metrics and I'm not exactly buying an asset right now. I could be wrong like my last short term trade. I'm getting ready to add another 6% to my SDS position soon trying to catch a large down day this week. I have a technical target for the S&P at 1475-1500 in the next two months.

[Deaddog]

I guess it all comes down to a hunch. I don't really have any value metrics and I'm not exactly buying an asset right now. I could be wrong like my last short term trade. I'm getting ready to add another 6% to my SDS position soon trying to catch a large down day this week. I have a technical target for the S&P at 1475-1500 in the next two months.

Good Luck;

One thing about a short position is that you are not quite as reluctant to bail if things go against you.

[Duniyo]

"I guess it all comes down to a hunch..." be careful of "hunches", it's better to have a metrics in which to evaluated stocks.

[billyjoe]

"They say you can't make money timing the market" (antioch6) Vectorvest would say that quote is wrong. They have a system that gives a confirmed up signal, a neutral signal, and a confirmed down signal. They recommend buying only during confirmed up signal periods. They say to hold during neutral signals and sell when market turns to confirmed down signal or hold stocks until a predetermined stop is hit. They backtested this theory over a several year span and claim that it would have returned incredible results. The only thing being an active trader could go crazy waiting 6 months for a signal to turn green (buy).

-------------------billy

[antioch6]

added 5.2% short in SDS at 38.257

[antioch6]

Looks like the drop I am anticipating isn't ready to come yet. I'm planning to sell my inverse ETFs next week if the S&P 500 opens down the first few days, or if they hit my stops with a 2.1% rally in the S&P. This short term outsmarting isn't easy or simple so far.

[Deaddog]

That's the problem with playing hunches.

You should be able to explain why you took a trade. You should have a set of well thought out and back tested rules you use to enter and exit a trade.

Hey it could still work out for you. You haven’t hit your stop yet but wouldn’t it be nice to have a plan in place so that when the market opens next week you know exactly how you are going to react to what the market does.

[antioch6]

Forget to post yesterday I added a little more TWM near the open. Sat with some losses during the day and came back to even at the end. Added another 0.33% bringing my TWM position to about 3%. Still don't think the larger correction I was looking for is coming yet, just a preview and I'll try to cover on some sharp downside this week or early next.