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July 22, 2012 / redman59

Things Were Fine…Until We Opened

With all the bad data that came out in the globex session the futures looked good this morning as the globex session shrugged off the data, that is until the market opened and then it was a trend down day from there. On my end all I can say is that I covered my positions too damn early. I closed all of my positions today and went to 100% cash. I went into today with the following (% are % of account):

Cash @ 87.2%
Long bias @ 6.6%:
-NKE Bull Put Spread @ 6.6%
Short bias @ 6.2%:
-SPY Single Put @ 2.3%
-KO Single Put @ 3.9%

Aside from closing these positions I made one daytrade in AAPL in that I went short via the weekly puts that expire tomorrow. It failed to breakout out of today’s opening range and I shorted it as it came back in but covered too damn early as the 25% gain I took turned into 180% at end of day.

I took an early loss in the NKE position. It was slight positive for the day but I kept holding it as I had the KO & SPY shorts on but it struggled to get back above 101 so I covered the position. I also covered the SPY & KO puts all a little early as I believed that we would stall. Instead the market continued its great trend day and anyone trying to catch a bottom probably failed. One chart I pay attention to, and encourage other traders to watch, is the emini-SP500 on the 3 minute timeframe and all day this chart stuck in its trend. Notes can be found on the chart below and the breakout attempts never saw confirmation for what I look for.

I now stand at 100% cash and think we may see a positive today tomorrow. But in my opinion this will create a better short opportunity than a time to go long. The damage today was very distributive and being at the top of the move we have seen creates better probability for shorts here rather than longs (all my opinion of course).

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