Hi, traders. I think the overall market is kind of in "no-man's land" right now - maybe a little late to short aggressively but too early to buy every dip - so I did two videos on managing stop levels this week instead. I have received some emails on this topic so I hope the video helps you out. One basic idea I use constantly is to ask the question "what will make this chart look bad?" and use that as my stop loss level (in some cases). The other is to use the nine-day MA as a trailing level to place stops (in most cases).
Part one deals with the two losses and two breakeven positions I have had so far this year. Part two deals with three gains I have had, although I now realize I did not include MGIC (15% gain). Sorry for missing that one, but it was a short-term trade and I did explain the rationale on the blog this past week.
I do have a few nice looking charts that I will be watching this week in case the market decides to right itself, but overall I expect a little chop before the market decides what it really wants to do. Those weeks are always difficult (and don't forget the deluge of earnings the market will be hit with this week) so treading lightly might be your best bet. As I said Friday, my signals are bearish so that is overall the most important thing in my mind at this juncture.
Hope you find the video helpful and informative. As always, feel free to email me with questions or comments - I enjoy hearing from my readers.
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