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发表于 2009-3-28 12:09
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The S&P 100 also approached its retracement level today, almost perfectly touching it. I keep getting the feel that, barring shocking news, the selling pressure is really going to abate. But I am not convinced enough of that prospect to close out positions; it's simply too likely I will leave profits on the table. I'd rather align myself with the broad trend, which I have almost no doubt is firmly in place.
My chart of the S&P 500 doesn't reveal any rock-solid answers either. We are diddling around the ~1260 retracement. I have seen 1170 cited in so many places as the obvious support zone, it makes me wonder what the market is going to do to prove us all wrong! It just seems too easy an answer.
I want to make one last comment on contingent stop orders. A fair number of people have written me about putting stops on their options positions - - that is, the option instrument itself. In my opinion, that is really the wrong way to go. Options are far too thinly traded, their spreads too wide, and their trading too volatile, to justify such an action.
I think by far the better choice is to have a contingent stop. For those who don't know about this, it simply means that if the underlying instrument does something or another, then your option order goes through. Let's say you have puts on AAPL, but your hypothesis will be broken if AAPL crosses above, let's say, $190. A contingent stop would simply assert that, should AAPL cross above $190, an immediate order will be created to sell your options position at the market (you could use a limit order, but I think that too would be foolhardy).
If you use stops - and I hope you do - I cannot recommend strongly enough making use of contingent stops as opposed to the "normal" stop orders. I am pretty sure most brokers offer this, but if yours doesn't, that probably is reason enough to change your firm.
I think I'm going to hang up my keyboard for the day; thanks for stopping by, and many thanks for the marvelous comments section and all the fantastic contributors there!
Posted: 03:59 下午 | Comments (View) | Permalink
七月 24, 2008 - 11:43 下午Real Life Bear EncounterIt's nearly midnight as I am typing this. A few minutes ago, I encountered a wild bear.
Nope, I'm not making this up. Let me explain. As regular readers know, I am at Fallen Leaf Lake near Tahoe. Tonight I decided to do some star-gazing, since everything is so clear here - - you can easily see the Milky Way, and Jupiter is almost painfully bright. So I went out on the boat dock, did the star thing, and started heading back to the lodge.
A couple of guys were staring at something, and since I'm the curious sort, I hunched down to see what they were looking at. It was a brown bear, probably about five feet long, staring back at us, maybe fifteen feet away. Even though I heard a story yesterday about a woman whose arms were both taken off by a bear (in Alaska, not around here), I didn't feel nervous. We made some noise, and he galoomphed away. He was really very beautiful, and I was glad to have seen him. Although the thought did occur to me how ironic it would be if I was maimed or killed by a bear, of all things. I think he could sense I was a kindred spirit, so he left us unharmed. Had I been Abby Joseph Cohen, he surely would have attacked, in spite of the smell.
I had compiled a ton of charts tonight, but my connection is rather slow, so I'm actually going to make this quick. I had a very, very good day today. I'm not sure if it was my best percentage gain ever, but it was awfully close. I was blown away how well things went. Even though energy has slowed its descent, my energy puts did terrific, and I'm still wondering if OIH is going to break beneath its fan line to start the next act of this play.
I am extremely short banks, and I find the huge rally provided by the bulls a few days ago to be a tremendous blessing. It made things cheap for bears.
In all the tumult, there are a couple of ways to play it - - either play the bullish side by taking advantage of battered prices, or play the bearish side by taking advantage of pullbacks. CAL is an example of the latter, since I shorted it after it rebounded hundreds of percent in just days. |
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