Wheeee, that was fun!
Huge fun, of course, for anyone who took our advice and shorted the Nasdaq Futures (/NQ) at 7,000 yesterday morning. Those Nasdaq Futures pay $20 per point and the Nasdaq plunged 100 points to 6,900 for a $2,000 per contract gainon the day – you're welcome! That was the same call I made the morning before at the Trader's Expo Live Trading Challenge – it just took longer than I thought for us to cash in!
We also cashed in our 0.95 GE March $13.50 calls for $1.60 for a 0.65 (68%) gain on 100 contracts (up $6,500) – also from the Trading Challenge. Gasoline (/RB) fell to $1.975 for gains of $500 per contract– also from the Trading Challenge and the the Dow dropped 200 points from our Trading Challenge entry (25,650) for gains of $1,000 per contract but, sadly, the challenge ended at 10:30 yesterday – so I still lost. I'm just not a day-trader but the Fundamental picks tend to work out – eventually.
Best of all, our Long-Term Portfolio finished the day at $551,871 (up 10.4%) which is up $1,008 (0.2%) on a bad day – so we know we're doing something right there while our Short-Term Portfolio, which hedges the LTP, did it's job and gained $6,600 (6.6%) on the market drop so, as we intended, we're very well-hedged for the coming market chop into the month's end. It is ALL about balance in an uncertain market!
What we're looking for, at the moment, is whether or not the indexes can hold their 50-day moving averages from above, which are (rounded) Dow 25,525, S&P 2,735, Nasdaq 6,680, NYSE 13,000 and Russell 1,550. The NYSE and Russell are below and the others are above so it's simply a matter of whether the Russell breaks up or the S&P (closest) breaks down to confirm a rally. Other than that, we're pretty agnostic today into day 2 of Powell's testimony (but no surprises expected):
As I said yesterday, we just have to go with the flow but I'll still take a short on the Futures at Dow (/YM) 25,500 with a tight stop above – there should be a bit of resistance there and, if they S&P can't hold that 2,750 line – next stop is 2,735 and below that is DOOM!!!
Enjoy your day…