bankedout's trading journal

[bankedout]

Walmart was one of the last strongholds of the bull. Now it has been cracked:



Wow!

I'm thinking if BAC's breakout can become a failure, this whole market can get ripped wide open.

I'll be putting in a bunch of buy stops on Bearish ETFs this weekend.....

[bankedout]

I think the market's message on Friday was that it is even more bearish than I anticipated. I was expecting 1-2 days more of an advance.

Previously I had proposed that I somehow knew which sectors etc. would lead the next leg down. I think that is foolish to make such a prediction.

I'm going to let the market draw me in. I'm dividing my account in to 10% portions. 1 portion has already been used on Crude Oil.

I'll put 9 more orders in tomorrow on bearish ETFs. If the market gets bearish enough, it will draw me in completely. This would be the equivalent of being 300% short in the account.

If things don't turn out as bearish as I'm thinking, my buy stops will not trigger.

I'd like to set this up now, but I have to go to work.

Best of luck to all.

[sd]

I know I don't need to tell you this, but the leveraged ETF's will tend to gap at the open much wider, and the only safe way to enter is Buy stops with limits-
I cannot agree with your assessment though of a market wide move substantially further down because of Friday's pullback after the Thursday rally- I think the market "waits" on the election results and then chooses direction-
Note that BAC actually gapped higher on Friday and held the gap- While the XLF closed lower-
I like the idea of reducing your Risk/ exposure in 10% (sector?) increments- That is prudent, but the 3x leveraged funds would indeed make me nervous- I hope you succeed!
Your strategy is interesting- But consider your same counsel- about the right side of the page- 300% leverage is very substantial. Until the trade has headed in your direction, you are more susceptible to whipsaw acrtion?
About the prior 2 trades-
Those were very minor losses on the trades-
"My sell stops triggered in UDOW & TQQQ yesterday.

Results of the trades: UDOW -0.3% TQQQ -1.9%

A mistake was made on my part. I put sell stops below the prior day's low. However, the premise of the trade was that each day the ETF would have a higher low than the prior day. Therefore the sell stop should have been placed above the prior day's low. I'll try to correct my stop placement going forward."

That would indeed reduce your loss but would increase the probability of your stop being hit- You are expecting a reversal of trend with all these trades, and so the prior day's low was a bounce in your direction, where the previous 3 days actually established the swing low in the downtrend-

Just a thought- suppose you used a Buy-stop entry with limit and used a 1.5x ATR on the trade? or the prior low- which ever was greater?
And- since this is uncharted territory with momentum using 3x leverage- How about taking a 1/2 position on the initial entry and following up with the additional 1/2 once the trade closes in your direction profitible- Since your expectation is for a market wide move that should have multi day substance-- you would still be in a position to gain with slightly reduced results from an early entry if it succeeds out the gate- Should it not succeed as intended, you have a second at bat waiting-
This would be prudent since the reversal of trend is not yet in your direction and you are betting on your presumption of what the market will do without seeing evidence of it (Again- that pesky right side of the page) LOL!
The very best of Luck with your trade! SD

[bankedout]

I understand your concept of stops with limits, however I do want to execute the trade on a gap. I think if the market gaps below support created in late October, it is a very bearish sign. I would not expect the gap to get filled. Nor would I want to be left on the sidelines.

In my opinion, the markets medium term (weeks to months) trend is clearly established as downwards. So I view my next trades are trading with the trend. Also, working in my favor will be trading with the short term trend in my favor as well.

I was thinking of establishing the 10% positions, and then easing up to 5% when I think the short term momentum is fading. Perhaps a week from entry.

I want the risk involved with 300% leverage. To me trading indexes/sectors without leverage is way too dull.

I'm not so sure the market will react to election results at all. I think it is already looking much further in to the future than that.

We shall see, as always. Thank you for your input.

[bankedout]

Friday's market map was very red:

finviz.com/map.ashx

The short term rally was really extinguished with authority, in my opinion.

[bankedout]

Here are the orders I put in. All are buy stops good til cancelled.

28 DUST $28.51 Gold Miners (GDX)
52 GASX $15.66 Nat Gas Rel (FCG)
39 RUSS $20.81 Russia (RSX)
67 EDZ $12.06 Emerging Markets (EEM)
97 ERY $8.41 Energy (IYE)
45 FAZ $17.91 Financial (IYF)
49 TZA $16.46 Small Caps (IWM)
19 SPXU $41.21 S&P 500 (SPY)
11 SDOW $72.11 Dow (DIA)

[bankedout]

I bought 28 shares of DUST today at $28.52 This is an inverse of the Gold Miners (GDX)

[bankedout]

Things to watch:

See if WFC can hold above $33.50 and what happens if it cannot.

See if XOM can hold above $89.68 and what happens if it cannot.

My guess is neither will hold, and both will be a big blow to the market.

As always, we shall see!

[bankedout]

I had to close my DWTI position this morning. Crude Oil is not weakening as I anticipated.

Result of the trade -4.3%

I think the low liquidity of the product negatively impacted my results as well.

[bankedout]

Today I bought 35 shares of DRV at $22.95 which is an inverse of Real Estate stocks (IYR)

[bankedout]

I closed my DUST position today at $27.64

Result of the trade is -3.1%

I may re-enter at some point.

[bankedout]

I put a new buy stop in on DUST for just above today's high at $28.76

[bankedout]

I ended up closing my DRV at a 2% loss, but more importantly I used up one of my precious day trades. I hate when that happens!

People seem like they are having a hard time deciding if they are bullish or bearish lately.

[bankedout]

I cancelled all of my buy stops. I'm off work tomorrow, so I will manually enter my position(s) if anything looks like it has potential.

[bankedout]

I bought 49 shares of GASX at $16.21 This is an inverse of Natural Gas Related stocks (FCG)