As technology advances, the variety of tools and strategies available to individual traders increases accordingly, and for newer traders the sheer number of techniques and strategies on offer can be daunting. Short Term Trading Strategies That Work by Larry Connors is a nice introduction to some of the trading rules and strategies that have proven consistently helpful for navigating the markets.
One of the best things about this text is that each strategy or technique is treated in quantitative terms. Even perennial…
Here are some data that have us thinking this afternoon: maybe the Nasdaq doesn’t resume its parabolic move from here.
There are certainly plenty of short term reasons for Nasdaq bulls to frown and doze off for awhile: the QQQQs are up over 7% in 7 days. Money flow has been stagnant. The ADX line is only barely ticking up, and RSI readings at various periods are all inching toward overbought. The McClellan Oscillator (attached) may have peaked, and even if…
On a day like this, you really need to start off any post with some good news. Apparently, one of the greatest television shows of our time might be made into a movie: we’re talking about Arrested Development. So you see, there is hope for this country after all. (Nevermind that we’re all so scared of the boogeyman that the government will be warrantlessly watching the movie over our shoulders; that’s a matter for another day.)
Okay, now to the issue at…
These are very short term overbought/oversold technical plays only.
Energy (XLE)
Thesis: The Energy ETF is well overbought on a short-term basis – practically maxed out at 99.98, and the implied volatility relative to its historical volatility over the past 21 sessions is also giving a sell signal.
Trade: Buy buy buy lots of naked puts! Just kidding. The XLE April 80/82 call vertical is selling for about $0.60. There are only 8 days left until April expiration if things don’t turn out…
So yesterday we suggested that everybody keep an eye on their deltas ahead of Friday’s big employment number. Well, if volatility readings today are to be believed, you could probably be trading blind today and tomorrow and not really notice – the index volatility indexes (VIX, VXN, VXD, RVX) opened higher but then sold off for the rest of the day. Maybe everybody got their “employment number” puts at the open. Either way, implied volatility is low just about everywhere,…
Friday, January 9, 2009
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