Lessons

1. If VIX is under 26, buy the dip. If VIX is over 26, sell the rip.

2. Always trade in the direction of the larger trend. Find the strongest trend in your time period.

3. Nothing as bearish as a failed breakout. Nothing as bullish as a failed break down.

4. Don't worry about the last dollar. Take your money and go to the beach!

5. No more than four positions at a time. Preferably 2-4. Scope out others. Pick the strongest.

6. Buy the strongest; sell (short) the weakest.

7. Nothing is guaranteed. Nothing.

Friday, November 29, 2013

Roadmap

We are nearing a minor, ST top in the market, which may have come today, or will come on Monday, December 2, around SPX 1820.

After this top, NFLX should come down to 350, RUT to 1120 to 1130, AAPL to 540-545. This will be a buying opportunity. SPX 1785 would be a gift.

After the bottom, NFLX is going to 400 (or thereabouts), and RUT to 1160, SPX to 1900-1910, and AAPL to 565-570. At that point, we should have a major top.

I am short NFLX (at around $364.5) and AAPL ($456) via puts. I plan to cover at the above-mentioned targets and go lightly long.

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