Had to use some margin today for Apple (AAPL) at $521.25 with a stop loss at $520.50. It has approximately 3% to run before it starts knocking its head on a short-term downtrend line. If the trade gets off the ground the stops will be very tight in that area.
The markets look like they want to begin a comeback. Obviously there has been a ton of damage done to the charts for some of the major indexes, QQQ & IWM so my stops are tight. I bought IWM with a stop loss at $111.85. If the trade can get off the ground my stops will be moved up to break even quickly.
I love reading articles preaching that this little “dip,” is insignificant and to stay the course. After all the S&P is still only a few points from all time highs. Reminds me of similar articles from 2008 and Apple at $705.00. Couldn’t disagree stronger. It is true that this hasn’t been anything close to a market crash and the primary trend is still up. However, from a technical, trend following perspective, this is the ugliest, most dangerous position that the markets have been in since November 15, 2012. Having your nest egg in the market right now on the long side is gambling. Catching the turn around day if it is in our near future will yield gains. However, every potential support point thus far has been sliced through like a knife through butter. The market can obviously turn around on a dime, and if it does, I’ll be ready for action. Before I buy a stock I ask myself, am I betting that something will happen or am I betting on something that has happened? If the market turns around (something has happened) I’ll be all over it. Until then a penny saved is a penny earned. Sticking with GLD but otherwise on the sidelines.
Purchased (XLV) today, (Healthcare Stock ETF) at $57.79 with a stop loss of $57.49. This sector has gotten hammered and should be ready to outperform the SPY if today was a reversal. The daily chart looks great, we’ll see what happens.
Still like Gold here. The lack of enthusiasm today was a little concerning but I continue to hold GLD.
I purchased Gold (GLD) yesterday at $125.18 and have now moved my stop loss up to break even. I think GLD could run about 9% from here with a downside of nothing (except a nasty gap down.) Gold took off like a rocket this year and has now pulled back to about the 50% level of that initial run. The 5DMA has flattened and GLD turned on a potential support area. The market has been some tough sledding this year and I’ve been sitting on my hands for some time except for the occasional intra-day IWM short. GLD has a zero to negative correlation to stocks so that makes me like it even more here. We’ll see what happens.
Being 100% cash in all accounts gets boring after extended periods of time. However, accepting a boring investment strategy can really pay dividends. I like owning stocks when making money in the market is easy. That time is not now.
The market continues to look really strong here but with 100% of my 401k in midcaps, RSI getting hot, and the spinning top formation in the S&P, I’m going to ring the register on this great run and wait and see what the market wants to do next. Hogs get slaughtered.