Strategy, Approach and Statistics

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Wednesday, February 1, 2012

DOW Overhead Resistance at 12750

It was a mixed day. Market started the day higher, but couldn't sustain DOW 12750 levels. Market was led by technology and banks. Money is rotating between sectors, so there are opportunities, but overall the market is not rising beyond the overhead resistance. Fantastic-5 (see my post on Friday) is historically bullish. I expect this week to be range-bound, but be prepared for a pullback starting next week.

STX led the tech stocks by gaining approximately 20%. Earlier in the day, I thought to hold STX for a potential pullback, but later overcame the emotions and decided to exit the trade. Over 15% gain on CMI in 1-day was good enough reason to close the position. We are still making money for the current week (15% booked gains)!

Two trades are initiated today anticipating flat to bearish market action. Part of the reason to initiate puts was to balance long position on Texas instruments.

All open positions are in the money. TXN is leading the gain, and my target is $2.20.

Talk to you tomorrow.

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