Category: Trades

The long bond just completed a cup and handle.

With the break of 165, it went right to its target of 175 plus some. Put simply, I just missed this trade. The bond bull market that started in 1982 is not over. I will last a lot longer than most people think. Before this is all over, you could see 30 year mortgage rates at 1.5%.

The oil market looks like it is going to make a failed head and shoulder pattern.

Normally, I would wait until it breaks the right shoulder to get confirmation of this. That would be a weekly close above $65. But mass panic over the coronavirus has caused such a wonderful buying opportunity that I can not let it pass me by.
By all indications, it appears the virus has peaked in terms of infections in China. Manufacturers are beginning to resume their operations in mainland China.
As this is happening, the bureaucrats at the CDC are causing a panic which is setting off the algo’s to sell.

Bureaucrats are risk adverse. ‘Better be safe than sorry’ is taken to the extreme. Yes the coronavirus has disrupted demand. But the worst appears to be over.  As speculators, you should look to the future.

I took profits on the Russell 2K trade. The target was 1750 but it has gotten close enough for me.

Naturally, I feel regret about the Nasdaq, SP500 and DOW trades. I looked for the exit to early. The charts were telling me to stay long and strong. Yes they reached the daily targets, but the weekly charts were telling me to let me profits run. My emotions got the best of me. Mainly being impatient. I am probably making the same mistake right now with the Russell 2000.
There is nothing worse than watching massive profits turn into losses. When you trade the futures market, your fortune can turn to misery in a few minutes. This is due to the high leverage. I am not a mechanical trader. I “felt” a correction coming. It never came. I left over 10K on the table. I wrote a list of trading rules long ago. I took another look at them today. These three jumped out at me:
Rule #11-There will always be another trade. It is better to miss a trade than to chase it.
Rule #12-Trading from my gut is a quick way to the poor house.
Rule #15-Losing trades, losing weeks, losing months and losing years will come. That’s the nature of the business. Nothing is guaranteed. If you don’t like it, don’t trade.

Rule 11 and 15 tell me to get over it. Not following rule 12 is what got me.

I am taking profits in almost everything except the Russell 2K. They have all reached the price targets plus some.

I still have a very small position in the DJIA, but I have officially closed it in the performance tab.
No point in getting greedy here. I traded my plan and made very good money.
The market looks like it wants to take a rest. A modest correction looks likely. I do not plan on waiting it out.

The daily chart formations for the DOW and SP500 have completed.

However, I am not closing out my trades in these two markets since they completed a running wedge on the weekly charts.


The completion of the running wedge puts the DOW at 32K and the SP500 at 3500.
The Russell 2K is still advancing but taking an eternity to get to its price target of 1750.

Naturally, I regret closing out the NASDAQ trade early since it has been the strongest market.

The completion of this running wedge puts the NASDAQ at 10,000.

I closed out my NASDAQ trade at 8528 for a large profit. The target was 8600, but it got close enough for me.

There are two reasons I wanted to close this trade.
First, I will have to roll over my December futures soon.
Second, the trade deal with China is supposed to finalize this Sunday. I do not want the market to gap down on me when futures start trading again Sunday night because of some botched deal. I am still long the Russell, SP500 and Dow. If the market does gap down Sunday night, my other trades might get stopped out. However, I will still be in the green because I took the profits from this trade.

The Russell 2000 broke out of a 10 month rectangle.

Stop was placed at 1579. Target is 1790. For the DOW, SP500 and NASDAQ trades, I moved up my stops to a break even point. Once a trade moves 25% of the way to my target, I move up my stops to at least the break even point.