Friday, February 12, 2010

Using the S&P 500 to Enter and Exit Trades ...

Successful traders know that anticipating market direction is extremely important. Do your current long and short positions reflect the direction of the S&P 500 after President's Day weekend?

The S&P 500 sold off in the morning to 1,063, yet closed at 1,07610 points higher than last Friday's 1,066. So net-net, the broad market was up for the week, not bad considering the bad geopolitics regarding sovereign debt in southern Europe, specifically Greece.

POTC believes it's extremely important, from a trading standpoint, to follow the S&P 500 and have an  opinion on its direction from week to week.

If you have a charting service you like, that's great, but if you don't, or would like a second opinion on market direction, just click any of the links in this piece and begin following the biggest and baddest in the world, America's Stalwart Index: The Standard and Poors 500.

Congratulations to all subscribers who profited from the BIDU trade based on on our PFF ratio analysis. Though we recommended an early exit, a return of 133% - 150% in 30 minutes of trading is still excellent.

We're looking forward to trading FSLR next week. We've spent many exhaustive hours researching, thinking, crunching, and feeling; here's looking-forward to Thursday, February 18th !

The Psychology of the Call team wishes everyone a happy and healthy weekend.


Carl said...

Bulls eye call on BIDU, I was skiptical about the selection of your strike price at first, but it turned out to be the best gain money can buy, with limited exposure (sort of) on the downside.

Too bad I did not catch the BIDU trade email until after the hour. But did make a quick trade on SLV (short it yesterday and covered this morning) based on your GLD prediction. Can't wait on your FSLR call next Thursday.

I am forever faithful of your analysis and wisdom. Have a great Presidence weekend!

Anonymous said...

Thanks Carl. We put in mega hours of time, but even that doesn't matter IF you're off on timing of entry. Thanks again, very much appreciate the kind words. More good trades ahead, but MUST trade small and smile when a loss occurs. Here's hoping FSLR will be a winner.
A fun President's Day back at you and yours, let's get this market started Tuesday!