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.

Thursday, February 12, 2009

2/12 Update

1. Vix forming a beautiful triangle on the daily chart. I think it will break up, when it is complete.
2. NAS against the ol 1250-1280 resistance. We haven't yet ever broken out of this zone since we entered it on 11/17 last year.
3. $NY50R confirms that we are headed down. This would be true even if we have an up day tomorrow.
4. $NYMO down. Forming a nice triangle, which I think will break down.
5. $NYSI - Look at the RSI, MACD and Stochs. Confirm down.
6. $ NYUDStill very strong negative divergence on 5 and 20 DMA.
7. SPX DAILY Stochs and CCI nowhere close to oversold. And all charts Daily Stochs are pointed down.
8. Yen Stochs still bearish (IMO).
Gold stocks may be forming a bull flag.

This is a fake out. We are going DOWN. Tuesday - Wednesday we test the November lows, we bounce off for Opex, then after Opex we go below. My 2 cents.
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