Category Archives for "End of Day Analysis"

Feb 16

Why we can safely ignore rate hike headlines

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

Wednesday was another choppy session for the S&P 500 with the index spending most of the day in the red before a late surge of buying pushed it above breakeven.

Stocks picked themselves up off of the intraday lows after the Fed’s meeting minutes revealed they still planned on a March rate hike. While this was consistent with previous Fed statements, some investors were relieved the minutes did not contain even more hawkish undertones.

While that explanation sounds plausible, the real truth is everyone who fears interest rate hikes has been abandoning ship since early January. And after six weeks of selling, we are running out of fearful owners that still have stocks left to sell.

At some point, everyone who wants to sell a headline will have gotten out. And all of those fearful sellers were replaced by buyers demonstrating an indifference to those same headlines when they bought despite them. And that is the magic point when those headlines stop mattering.

Six weeks is a long time and stocks have long since stopped falling on these same recycled “rate hike” headlines. That means it is safe to assume those headlines are priced-in and we no longer need to worry about more of the same. When the market doesn’t care, we don’t care.

No doubt headlines can get worse and the Fed can blindside the market with a more aggressive rate-hike schedule. But as long as the Fed sticks to their original plan, the worst of the selling is already behind us.

As for Wednesday’s price action, this was a bullish reversal. An opening gap lower failed to attract follow-on selling and prices closed the gap and finished just above breakeven. Bears had the perfect opportunity to break this rebound and they blew it.

If this market was truly overbought and vulnerable, prices would have fallen by now. A market that refuses to go down will eventually go up. That means January’s bounce is alive and well. Plan your trades accordingly.

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Feb 15

Why stocks could actually rally if Russia invades Ukraine

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

Tuesday was a good session for the S&P 500. A 1.6% gain allowed the index to break a three-day losing streak and reclaim the 200dma and 4,450 support. While one day doesn’t establish a new trend, it was nice to see the market bounce back from the latest bout of selling.

Russia hasn’t invaded Ukraine and that situation is avoiding the worst-case scenario…so far. But the thing to keep in mind regarding this event is markets deal with bad news a lot better than uncertainty. That’s because traders can put a price on bad news and factor it into the market. Unknow outcomes are impossible to quantify and traders tend to let their imagination get the worst of them.

This phenomenon of uncertainty being worse for stocks than bad news is what allows stocks to actually rally once bullets start flying. While no one wants to see that happen, a hot war means we stop debating what could happen and instead focus on the actual impact of the conflict. And in most instances, reality turns out less bad than feared.

And more than just “less bad than feared”, the turnover in ownership leading up to a conflict also helps stabilize prices. Owners that fear these events sell during the build-up and the subsequent buyers demonstrate a willingness to hold this headline environment. Ownership churn eventually gets to the point where all of the fearful owners have gotten out and there is no one left to sell the next round of headlines. And that’s when the bad news is finally priced in.

Are we close to that point? Maybe. Maybe not. But we get closer with each passing day and stocks will bounce long before most people expect. Anyone waiting for the news to improve will be too late. That’s why smart money buys when most people are still afraid.

As I wrote last week:

I took profits Thursday morning and now I’m sitting in cash, waiting for the next bounce. Maybe it happens Monday morning. If so, great, I start buying back in and will add more as the rebound progresses. But if the selloff continues, no big deal, I sit on my hands and wait for the next trading opportunity on Tuesday or Wednesday.

Well, as it turns out, the index bounced in the final hours of Monday’s session, reclaiming 4,400. That late surge of buying was our signal to test the water with a partial position. And Tuesday’s early strength told us to add more. So far so good. Keep a stop near Monday’s close and see where this goes.

If the selling resumes on Wednesday, no big deal, our early positions already have a nice profit cushion and we simply bail out near our purchase price. Small risks from being wrong and large rewards from being right? Sign me up! These are the risk/reward setups we dream of.

And if the selloff resumes, that’s okay too. We get out and try again next time. In fact, the lower we go now, the more money we make buying the next bounce, so I say bring it on. Either way, I’m ready for what comes next. Are you?

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Feb 11

What smart money will be doing Monday morning

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

Following seven positive days out of the previous nine sessions, the S&P 500 stumbled hard on days ten and eleven. Luckily, we knew this was coming. As I wrote Wednesday evening:

Expecting this 10% rally to keep going is getting a tad greedy. Markets move in waves and it is worth remembering that at both the bottoms and the tops. It is time to shift to a defensive mindset and protect what we have. Move stops up and see where this goes, but no one should be surprised if this stalls near 4,600 resistance.

Well, here we are, 48 hours later and nearly 200 points lower.

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Some people blame this latest pullback on high inflation and looming rate hikes. Others point to the imminent Russian invasion of Ukraine.

While both of these reasons appear valid, the problem is the market rallied strongly under these same storm clouds two weeks ago. Inflation, rate hikes, and a Russian military build-up are not new. Are we supposed to believe these headlines didn’t matter for weeks and then all of a sudden traders woke up and started freaking out? I don’t think so.

In reality, the market pulled back Thursday and Friday simply because it was time. As I reminded readers two weeks ago near the lows, markets move in waves and we should be ready for a strong bounce. Well, here we are, two weeks later and 300 points higher. Rather than pat ourselves on the back for buying the bounce, smart traders were getting defensive and preparing for the step back.

Markest move in waves. Always have, always will. And now that we’ve fallen 200 points, rather than panic, it is time to start looking for the next bounce.

Buy the bounce, sell the breakdown, and repeat as many times as necessary.

I took profits Thursday morning and now I’m sitting in cash, waiting for the next bounce. Maybe it happens Monday morning. If so, great, I start buying back in and will add more as the rebound progresses. But if the selloff continues, no big deal, I sit on my hands and wait for the next trading opportunity on Tuesday or Wednesday.

Volatile markets like this are actually fairly easy to trade because once a move gets started, it keeps going. As long as we have the courage to jump aboard early, it is a fairly nice ride.

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Feb 10

How savvy traders traded Thursday’s volatility. Plus what Bitcoin owners need to keep an eye on.

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

The S&P 500 took us on another wild ride Thursday.

Volatility kicked off when the consumer price index surged at the fastest rate in 40 years. That sent traders scrambling for cover and the index gapped 1.3% lower at the open. But as is often the case, the opening gap reversed within minutes and it wasn’t long before the index found itself back near breakeven.

Unfortunately, that early dip-buying proved fleeting and the index retested the early lows in midday trade. And when a bounce fizzles, the selling rarely stops at breakeven. By the close, the index found itself down nearly 2%. Ouch!

But this wasn’t unexpected. As I wrote Wednesday evening:

Expecting this 10% rally to keep going is getting a tad greedy. Markets move in waves and it is worth remembering that at both the bottoms and the tops.

While I still like this market and will keep holding a trade that is working, it is time to shift to a defensive mindset and protect what we have. Move stops up and see where this goes, but no one should be surprised if this stalls near 4,600 resistance and rests for a bit.

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Thursday’s price action did more than pause and rest, but that’s the way this goes sometimes.

As I wrote Wednesday evening, I can into Thursday holding the latest bounce off the 200dma and had a decent profit cushion. While I obviously wasn’t happy with the opening gap lower, I knew better than to overreact to early weakness. Instead of punching out at the open, I gave the market a few minutes to find its footing and that’s exactly what it did.

That bounce was my signal to keep holding and move my stops up near the early lows. Unfortunately, that early bounce didn’t stick and I got dumped out near 4,450. But that’s the way trading goes sometimes. I collect my profits and get ready for the next trading opportunity.

Maybe prices bounce Friday and I get back in. If that’s the case, no harm, no foul. Or maybe the selling continues Friday. If that happens, I continue sitting on my hands and wait for the next bounce.

At this point, I don’t really care what happens next. The only thing that matters is that I’m standing in the right place at the right time when the next move takes hold.

While bulls and bears argue about whether this market is going a lot higher or a lot lower, I will continue playing both sides of the fence. IMO, there is too much money to be made riding these waves to get hung up on labels and who is right and who is wrong.

Bring on the volatility.


For the first time in a while, Bitcoin is actually outperforming the equity indexes. The breakout above $40k resistance was a buy signal for anyone that missed last month’s bounce off of the lows.

While Bitcoin is trading well for the moment, I am wary of a near-term sell-the-news event following this weekend’s Super Bowl.

There is no reason to sell prematurely based on something that could happen. Instead, we move our stops up and trade what is happening. And for the moment, Bitcoin is trading well.

Just don’t get complacent if we see weakness next week.

Feb 09

What the January rebound tells us about what’s coming next

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

The S&P 500 popped Wednesday, making this the seventh up day out of the last nine trading sessions. Not bad for a market that was written off for dead two weeks ago.

Headlines remain mostly the same, but that’s the point. The economic situation is not deteriorating and we avoided the worst-case scenario, meaning a big portion of January’s panic selling was an overreaction. But that’s the way this usually goes.

Overly pessimistic markets set up to rally on “less bad than feared” and that’s been the story of the last two weeks. As I wrote back then, markets love symmetry and that means the biggest selloffs have the biggest bounces. And what do you know, the index is up nearly 10% from the January lows. Funny how that works.

Buy this bounce in a 3x ETF and now we are talking about real money. Not bad for two weeks of “work”.

But that was then and this is now. Expecting this 10% rally to keep going is getting a tad greedy. Markets move in waves and it is worth remembering that at both the bottoms and the tops.

While I still like this market and will keep holding a trade that is working, it is time to shift to a defensive mindset and protect what we have. Move stops up and see where this goes, but no one should be surprised if this stalls near 4,600 resistance and rests for a bit.

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Feb 08

The secret that makes trading this volatility easy. Plus what this weekend means for Bitcoin and a FB freebie.

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

The S&P 500 finished Tuesday in the green for the sixth time out of the last eight trading sessions and these gains leave us 7% above the intraday lows set barely two weeks ago.

Not bad for a bull market that was supposed to be dead. But this revival was always expected. As I’ve written many times before, the market loves symmetry and the biggest crashes are followed by the biggest bounces.

While no one can predict the exact moment when prices will stop falling and start bouncing, it doesn’t take a Ph.D. in Finance to identify the spot on a stock chart when prices stop falling and start climbing.

Emotional markets are as nimble as freight train trades. Once they get going, they tend to keep going and going and going. When we see that first bounce, all it takes is an hour or two to confirm the bounce and give us the green light to jump aboard. Wait any longer and we risk getting left behind.

And for anyone thinking this is nothing more than a case of hindsight bias, here’s what I wrote on January 24th when the January correction bottomed: 

Monday’s early 4% crash was far and away the largest losing session of this correction. And during periods like this, the critical thing to keep in mind is emotional, waterfall selloffs typically capitulate on their biggest down days.

And guess, what? This emotional, waterfall selloff capitulated on its biggest down day.

While we cannot go back in time and trade a missed opportunity, we can learn from this experience so we don’t make the same mistake again next time.

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As for where the market is going from here, this is the fourth session in a row the index tested the 200dma and 4,450 support. If this rebound was grossly overbought and vulnerable, it would have collapsed days ago. Instead, every time it challenges support, supply dries up and prices bounce.

And just as important, while volatility remains elevated, these swings are getting smaller and smaller. All of these are signs the market is coming to terms with imminent interest rate hikes and these headlines have largely been priced in. (i.e. Anyone that was afraid of these headlines already abandoned ship.)

While there are no guarantees and emotional selling can return at any moment for any reason, the first thing that needs to happen is for prices to actually start falling. Until that actually happens, this bounce is very much alive and well.

As for how to trade this, the index is buyable/holdable above 4,450. Anything under this level and it is time to get out and wait for the next bounce.


Bitcoin continues holding last week’s $40k breakout. While this is a good start, we will see a lot of crypto-related advertising thrown at the world during this weekend’s Super Bowl. But rather than propping Bitcoin up, this coming-out party could actually turn into a “sell the news” moment for Bitcoin.

The $40k breakout is holdable, but be ready with stops near $40k in case the “sell the news” crowd takes over this weekend.


Bonus: Look for a near-term bounce in FB. Start small, get in early, keep a nearby stop, and take profits quickly. As I said above, oversold moves tend to bounce hard.

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Feb 03

Is the index’s bounce still buyable or is smart money selling the breakdown? Plus, the stock FB could be following

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

Four consecutive up-days was all the S&P 500 could manage before the inevitable down-day came along and took back some of our profits.

But this was expected and only a fool was surprised by Thursday’s step back. -2.4% is definitely on the larger side, but as I wrote previously, the market loves symmetry. January’s spectacular correction was followed by a huge bounce, which ended with this oversized step-back. This is the way the market works. Always has, always will.

But as long as the amplitude of each successive swing is smaller than the one preceding it, we are moving in the right direction and the market is finding its footing.

Will stocks bounce back Friday? Or will we violate the 200dma and retest 4,400 support? Either outcome is likely and that means our trading plan needs to account for both.

Lucky for us, the plan is super easy: buy the bounce and sell the breakdown. It doesn’t need to be any more complicated than that.

This is an emotional market and that means the next move will also be oversized. And lucky for us, those are the easiest to trade because once they get going, they keep going.

As I told readers Wednesday evening, if Thursday’s opening gap bounced, hold the bounce and move our stops up to those early lows. While the mid-morning bounce looked promising, the index fizzled and retreated below the opening levels shortly after lunchtime. And that was our signal to start peeling off this week’s profits.

As easy as it is to buy back in, there is no reason to stick with a falling market. If prices bounce Friday morning, great, we get back in. If Thursday’s selling continues into Friday, no big deal, step aside and wait for the next bounce. Which could come as early as Friday afternoon.

People freak out when the market gets this volatile, but it really is easy to profit from these swings if we keep our heads and are willing to act decisively.

Start small, get in early, keep a nearby stop, and only add to a trade that is working. Follow those simple rules and we don’t have to fear volatility. In fact, with a little bit of practice, you will actually start looking forward to these profit opportunities.

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FB set all kinds of records during Thursday’s -26% implosion. But we already discussed most of this Wednesday evening and it isn’t worth repeating tonight. Instead, FB owners want to know what comes next, and unfortunately, the news isn’t good.

These things are almost never one-day events and that means there is more selling ahead of us. While the stock fell a tremendous amount and this was the highest volume session by miles, we still didn’t get a whole lot of turnover in ownership during Thursday’s session. The bulk of the losses came when the market was closed and by the time it opened, most owners were too shell-shocked to sell. That means there is still a lot of supply left in this stock.

If you want a recent example, check out PTON. That’s what it looks like when a high-growth stock stops growing and investors lose confidence. It isn’t pretty.

Now, it is premature to write off FB as dead. This is still one of the most successful and profitable companies in the world and no doubt the stock will make a comeback at some point. But it needs to get waaaay more oversold before that happens.

But for the optimists in the audience, if this stock breaks convention and actually bounces, that is a buyable opportunity with a stop under recent lows. Just don’t get your hopes up.

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Feb 02

What to expect from the indexes Thursday morning and the best way for FB owners to handle this massacre

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

The S&P 500 added nearly 1% Wednesday, making this the fourth up day in a row. These gains left the index just shy of 4,600 and miles above last week’s panicked test of 4,200 support.

But everything changed after the close when Meta (aka FB) announced mediocre earnings. While mediocre works for banks and utility stocks, when it comes to highflyers, mediocre is a cardinal sin. And as such, the stock got murdered in after-hours trade, falling more than 20%. Yikes!

And when one of the pillars of tech goes boom, the reverberations are felt throughout the market and the S&P 500 has already given up all of Wednesday’s gains in extended trading.

The market giveth and the market taketh away.

But we knew something like this was bound to happen. If not this, it would have been something else. As I reminded readers last week near the lows, markets move in waves. It also bears remembering this same principle applies following a sharp run-up. Stocks move in waves at both the lows and the highs.

Now, I have no idea what Thursday holds for the market. Maybe FB’s after-hours crash is a severe overreaction and the selling won’t be nearly this bad Thursday during regular hours. Or maybe FB is the spark that launches the next big wave of panicked selling. At this point, either outcome is likely and our trading plan needs to be prepared for both.

Hopefully, most of my readers bought this bounce at much lower levels and are sitting on a big profit cushion. That gives us a lot of flexibility when it comes to responding to a big opening gap Thursday morning.

As for trading large opening gaps, I like to give the market 15-ish minutes to find its footing. Even if the market jumps my stops, this is the one and only exception to selling at my stops “no matter what”.  Since I already took most of the hit during the overnight gap, waiting a few extra minutes doesn’t add a lot of additional risk to see if we get a quick bounce. If we bounce, great, I keep holding and move my stops to the early lows. If the selling continues, no big deal, I get out and wait for the next bounce.

But even with the index’s after-hours slump, given the size of my profit cushion from buying Monday’s bounce early, I’m not worried and will be sleeping like a baby tonight. If things get ugly Thursday, no big deal, I get out and start looking for the next trading opportunity. In fact, the bigger the selloff, the more money I make buying the bounce, so bring it on!

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Ummm yeah, in case you hadn’t heard, FB was murdered after the close. And that’s unfortunate. The stock was bouncing nicely off of $300 support this week and was very much buyable. But this 20% haircut reminds us that even good trades can fail spectacularly.

Now, even with this week’s modest profit margin, Thursday morning is going to be very, very painful for FB owners. But as I explained above, it is worth holding the stock for a few minutes after the open to see if prices bounce. Which they almost certainly will.

From there, it becomes a game of damage limitation. Don’t delude yourself into thinking there are rainbows and unicorns hiding behind these storm clouds. There will be a nice bounce over the next few hours and days. But rather than temp us into complacency, that is our opportunity to get out and limit our losses.

Without a doubt, this stock will be buyable again, but it has to go through some healing first. And I’d rather watch that from the sidelines.

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Feb 01

How smart money knew this bounce was coming. Plus, why tail-chasing in TSLA makes sense

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

Tuesday was another good session for the S&P 500 as it gained 0.7%, making this third up-day in a row.

Not bad given how much fear and uncertainty dominated the market only a handful of sessions ago. But that’s the way this usually goes. Stocks always bottom and bounce when pessimism is off the charts.

As obvious as this is after the fact, it always catches traders off guard in real-time. Humans love to draw trendlines from here to forever and are quick to assume that’s where we’re headed. But that’s not how this works … ever. Cognitively everyone understands markets move in waves, but they always forget this very basic fact in the heat of the moment.

Luckily for readers, I reminded them of this very thing last Thursday evening, hours before this big bounce started:

The thing to remember about dips is they don’t bounce until the crowd becomes convinced prices are headed lower. And right now, the AAII sentiment survey shows 52% bearishness, putting this stat at the highest levels in five years.

While we’ve hit 50% bearishness a couple of times over the last five years, each time that level turned out to be the capitulation point. Can bearishness get even higher? Sure. But is it the most likely outcome? Definitely not.

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Even a bear predicting a much bigger collapse should have been expecting a sharp, near-term bounce. That’s just how this game works.

Now that savvy bounce buyers are sitting on a pile of profits, (you are a savvy bounce buyer right?), it’s time to figure out what comes next.

Well, if the market moves in waves and we just experienced three big up-days, should we be planning on another three big up days? Of course not.

The time for buying has long since passed and now it is time to protect our profits. That doesn’t mean we need to pull the plug. But at the very least, we should be moving our trailng stops up to the lower to mid 4,400s.

Maybe January’s selloff is dead. Maybe it is only just getting started. Either way, my trading plan is ready for what comes next. I’m holding the bounce and will keep riding this wave higher if that’s the way it wants to go. But if this bounce fizzles and retreats, I’m happy to lock in my profits and wait for the next bounce.

While bulls and bears are busy arguing over where the market is headed next, I will be over here, quietly making money no matter which way it goes.


TSLA violated the $850 lows last week, triggering our stops. And hours later it bounced nicely off of $800 support.

While selling the $850 dip and buying the $800 bounce feels like an unnecessary exercise, we do what we gotta do because there was no guarantee $800 support was going to hold.

Just ask all of the people that held the momentary dip under $1,200, $1,100, $1k, and $900. Those poor owners are still waiting for their “imminent” bounce.

As an independent trader, my greatest strength is the nimbleness of my size. I would much rather get out too early than hold too long. Buying back in is easy and painless. But hoping and praying for prices to go back to the old highs? Yeah, that’s not so easy or quick.

But now that TSLA is back above $850, move our stops up and see where this goes.

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Jan 31

How I always know which bounce to buy. Plus, an obvious trade in AAPL pays off

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

The stock market loves symmetry and following a brutal few weeks, the S&P 500 was finally ready to bounce back with a vengeance.

The index climbed 1.9% on Monday, adding to Friday’s 2.4% pop, and now finds itself 7% above last Monday’s intraday lows. Blink and you missed the index reclaiming HALF of the January correction over just a few sessions!

But this was always going to be the case. Emotional markets make oversized moves … in both directions. +4% pop one day, followed a few days later by +2.5% and +1.9%.

While it is hard to call a -12% tumble from fun, rarely is it this easy to make a quick buck in the market.

As I explained to readers last week, the key to profiting from these opportunities is ensuring we are always standing in the right place at the right time. (That means both knowing when to get it and when to get out!)

While some people try to guess which bounce will be the real bounce, I’m too nimble of a trader to put up with such foolishness. Instead, I treat EVERY bounce as it if is the real bounce until it proves otherwise. Start small, get in early, keep a nearby stop, and only add to a position that is working.

Following those simple rules, I avoid the dips and am always there to capitalize on the bounces.

Sometimes I chase my tail during a false start, but you can bet I don’t mind a little extra effort when it eventually pays off like this.

Now, don’t get me wrong. January’s correction is far from over and we won’t be heading back to the highs anytime soon. But I’m sitting on a large cushion of profits while the “day-late and dollar-short” crowd is second-guessing this bounce. Which group would you rather be a part of?

Maybe this bounce fizzles and retreats, but that won’t be a problem because my trailing stops are already well above my entry points. And if I get dumped out, no big deal, I collect my profits and get to do this all over again the next time the market bounces.

Bring it on!

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AAPL turned strength into strength as it added 2.6% to Friday’s 7% pop.

But this is the way it usually works out with the best-of-the-best stocks and companies.

Always use a trailing stop to protect our profits, but never be afraid of getting back in just because our stops got us out. AAPL has been one of the best stocks of the last decade and odds are minuscule that it was going to suddenly forget how to make money.

Sell dips, buy bounces, and repeat.

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Jan 28

Why nimble traders are buying this bounce. Plus why AAPL’s pop shouldn’t surprise anyone

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

Give the stock market lemons and sometimes it makes lemonade. A strong rally Friday afternoon turned what would have been the fourth consecutive losing week for the S&P 500 into a winner. And boy, did we need this winner.

Headlines haven’t changed in a meaningful way and the Fed’s Taper and Rate Hikes are just around the corner. While those headlines triggered the first stock market correction since the original Covid selloff, the market seemed to find its footing this week.

The resilience started Monday afternoon when a midday 4% bloodbath reversed and surprisingly enough, turned into a 0.3% gain by the close. As shocking as that rebound was, most investors remained skeptical and the index continued probing 4,300 support all week. But much to the chagrin of bears, 4,300 withstood 4 different assaults before the market eventually closed Friday above 4,400.

Not bad. Not bad at all. Especially given where this could have gone.

As I’ve been writing all week, these things always look the worst moments before they turn around. By rule, they have to. If it didn’t look bad, people wouldn’t sell and prices wouldn’t fall. And the thing to keep in mind is these things don’t bounce until the crowd has been demoralized and given up.

While a few days holding 4,300 support doesn’t mean this correction is over, it does look good and that means nimble traders are riding along.

No one knows which bounce will be the real bounce. But as nimble traders, that isn’t a problem. Rather than pick sides and guess, we treat every bounce as it were the real deal until proven otherwise.

Buy the bounce, start small, get in early, keep a nearby stop, and only add to a trade that is working. Follow those simple rules and this is actually a really low-risk way of trading this volatility. Get in near the bottoms of these bounces and a few hours later we have a nice profit cushion protecting our backside.

Move our stops up to our entry points and if the selling resumes, we get out for what we paid. Big rewards for catching the rebound and small risks if we get it wrong? What’s not to like about that?

Now, don’t get me wrong. Nothing in the market is easy. And plenty of bounces fail. But if we are okay with chasing our tail a few times, by keeping at it, we ensure we will be standing in the right place at the right time. And catching the next big wave higher will make it all worthwhile.

If most people lose money buying the tops and selling the bottoms, shouldn’t we do the opposite?

I bought a partial position Friday morning and added more Friday afternoon. If prices retreat on Monday, no big deal, I get out and try again next time. But if the bounce keeps going, I will be sitting on a pile while everyone else is wondering if they should get in.

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It’s been a rough few weeks for AAPL as this market darling was weighed down by external market pressures. But a shift in investor sentiment didn’t change AAPL’s fundamental business model and the company shattered earnings expectations Thursday evening. And the most valuable company in the world got 7% more valuable Friday.

Not bad for those that still believed in this company. While smart investors use trailing stops to protect their profits, just because we get out doesn’t mean we cannot get back in. In fact, the first thing we should do as soon as our stops get us out is start looking for that next opportunity to get back in.

Monday’s crash and bounce was remarkable for all the reasons I mentioned previously. This stock was bound to bounce and it was only a matter of time. So when it finally bounced, savvy traders were ready. Buy the bounce and put a stop under the lows. It really isn’t that hard.

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Jan 27

How savvy traders are approaching these market lows. Plus the traders who AAPL is rewarding

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

Thursday was another back-and-forth session for the S&P 500 as early gains gave way to midday selling.

As I often remind readers, it’s not how we start but how we finish that matters most. Opening gaps are easily manipulated in the thin, overnight futures market. But the end of the day? That’s when the heavy hitters come out and there is no manipulating the close.

How we finish tells us what big money is thinking. And since big money drives the market, savvy traders always listen to what big money has to say.

At this point, we’ve had three weak closes in a row where the index retreated from intraday highs. While these late slumps haven’t sent us spiraling out of control yet, it does reveal big money is cautious at these levels and they are not chasing the bounces.

Without follow-on buying, every bounce stalls and retreats. But this isn’t unusual following such a demoralizing correction. Most investors are more worried about keeping what they have in this environment than making a quick buck buying the next bounce.

But the thing to remember about dips is they don’t bounce until the crowd becomes convinced prices are headed lower. And right now, the AAII sentiment survey shows 52% bearishness, putting this stat at the highest levels in five years.

While we’ve hit 50% bearishness a couple of times over the last five years, each time that level turned out to be the capitulation point. Can bearishness get even higher? Sure. But is it the most likely outcome? Definitely not.

So what do we do with all of this data? Big money’s reluctance to buy the dip means prices could retest Monday’s lows, but we are getting close to a near-term capitulation point where we run out of sellers.

Without a doubt, bear markets fall more than the 10%. But larger bear markets take time to develop. The pre-Financial Crisis top occurred in late 2007 and that bear market didn’t bottom until early 2009. Even short bear markets take three months to fully play out.

What I’m getting at is that while stocks could fall further from these levels, we’re not going there in one big jump. And that means we should expect some stability and bounces along the way.

Call them false bottoms, but to a nimble trader, those are buyable bounces. And that’s how I will be trading them.

To be perfectly honest, I don’t know which bounce will be the real bounce. (No one does.) The best way I’ve found to deal with this uncertainty is to assume everything is real until the price action proves otherwise.

That means I will keep buying bounces and selling them when they break down. (Start small, get in early, keep a nearby stop, and only add to a trade that is working.)

Sure, I’ll take it on the chops a few times, but losing a dozen points on a 1/3 position isn’t that big of a deal. Especially when bounces like Monday rack up 200 points of profit within hours.

While it is increasingly looking like Monday’s bounce is a bust, it was still a profitable trade for those of us willing to jump aboard it early and lock in profits when prices started slumping.

If the market wants to undercut Monday’s lows and bounce another 200 points, I’m perfectly willing to do it all over again. Buy the bounces, sell the dips, and keep at it until something better comes along.

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While this market correction has been destroying the FAANG stocks and even mega-caps like AAPL are not immune to the market’s forces, these highfliers did give us an entry point this week after bouncing off of Monday’s lows.

(Important note: we buy bounces not dips!)

While this was a slow trade to get started, AAPL is finally proving its worth, smashing earnings expectations and popping 5% in after-hours trade.

As I wrote earlier this week, people pray for market pullbacks so they can buy more of their favorite stocks, but every time the market answers their prayers, most of them are too chicken act. But for those willing to buy AAPL’s bounce, this is turning into a nice trade. Move stops up and see where this goes.

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Jan 26

The easy way to trade this market volatility. Plus what to do with TSLA at these levels

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

The S&P 500 took us on another wild ride Wednesday.

The session started off well enough with the index spending most of the day up a healthy 2%. Unfortunately, the Fed rained on the market’s parade when they hinted at the possibility of a more aggressive rate-hike schedule than many investors expected.

As much as bulls and bears want to argue over what this means for stocks, for savvy traders, the process is fairly simple. Either this is a non-event and prices make their way back to the highs over the next few weeks and months. Or the market is about to implode in a death spiral of panicked selling.

Option A we go up. Option B we go down. Why bother picking sides when it will be easy enough to simply follow the market’s lead? That’s what I will be doing.

The only thing that matters to me is the market does something. If I’m fully honest, it would be nice to see stocks fall a little further because cheaper is always better. But if it wants to go higher, I’m fine with that too.

Buy the bounce, sell the breakdown, and collect my profits. It doesn’t really get any more straightforward than that.

As for how I’m trading this. As I explained in my previous posts this week, I bought Monday’s bounce and was adding to that position with stops at or above my entry points. Things were looking really good Wednesday when the rebound was hitting new highs. But the Fed came along and changed all of that.

This remains an emotional and volatile market and there are no half-steps. When the market started falling Wednesday afternoon, that was our sign to get out. Holding and hoping for a quick bounce wasn’t an option. This market moves too fast to think like that. Pull the plug quickly and start looking for the next entry point.

If a person acted decisively enough, they pocketed some nice profits locking in this week’s swift bounce from Monday’s lows.

While it’s nice to pocket a few bucks, we are always looking toward what’s coming next.

Maybe the index bounces Thursday, giving us another nice entry. Or maybe the panic selling sends us crashing under Monday’s lows. Either way, I’m perfectly content being a little late than a lot early. I’ll let other people argue about what stocks “should” be doing. Instead, I’ll stick with trading what it “is” doing.

Buy the bounce and sell the breakdown. Start small, get in early, keep a nearby stop, and only add to a position that is working. And if I get dumped out, no big deal, I wait for the next bounce and try again.

Follow a simple trading plan and this isn’t nearly as difficult as most people make it out to be.

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TSLA reported historic profits after the close but the stock barely moved in after-hours trade. While flat isn’t as exciting as up, it sure beats going down. That tells us most investors were expecting this result and are comfortable with these valuations.

More important is this week’s bounce off of $850 is still intact. Stick with this bounce as long as it remains above support and see where this trade goes.

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Jan 25

The market gods answered your prayers. What are you waiting for? Plus the next profit opportunity in TSLA

By Jani Ziedins | End of Day Analysis , Free CMU

Free After-Hours Analysis:

Tuesday was another wild session for the S&P 500 as it swung between 3% losses and breakeven before eventually finishing down an intermediate 1.2%.

When is a 1.2% haircut actually considered constructive price action? When it follows a 4% intraday reversal the day before. In this case, two steps forward, half a step back. It is hard to call Tuesday a bad day given what could have happened.

If Monday’s sharp rebound was a house of cards, it would have collapsed Tuesday during that early 3% retreat. But instead of spiraling out of control, supply dried up and prices spent most of the day comfortably above those early lows.

Everyone laments how they wish their favorite stocks would pull back so they could buy more. But every time the market gods answer our prayers, most people lose their nerve. Instead of loading up on all of those wished-for discounts, most people join the panicked herd dumping stocks. Pretty ironic, eh?

While it feels like these selloffs and bounces come out of nowhere, that is almost never the case. Like a lobster resting in a cool pot of water, the heat comes on gradually.

Back in early January, we got that first interest rate fueled 2% tumble. But the market actually gave us plenty of time to get out near 4,750 when prices undercut recent lows. (You use trailing stops right???) That was our first and best signal to start peeling off profits. A few days later, the index bounced off 4,600. People who missed the first 4,750 selling opportunities were given another chance to get out.

And here we are, two weeks later, testing 4,200.

As I told readers back on January 5th when all of this started: 

I came into Wednesday with sensible trailing stops spread across the lower to mid 4,700s to protect my profits “just in case”, but I was already pulling the plug on some of those positions long before those stops got hit. As easy as it is to buy back in, there is no reason to stick around when the tide so obviously starts turning against us. When the panic selling hits, I want to be one of the first to get out, not one of the last. And that means acting early and decisively.

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That was then, but what about now?

While Monday’s 4% rebound left a lot of people flat-footed, Tuesday’s retrench gave everyone another shot at buying those big discounts. Did you have the nerve to take advantage of it?

Remember, start small, get in early, keep a nearby stop, and only add to a position that is working. Follow those simple guidelines and you can profit from these great trading opportunities too.

If prices retreat later this week, no big deal. We get out at our stops and then buy the next bounce. It really isn’t that hard.

If a person is paying attention, the market isn’t nearly as cruel as its reputation. Look for the clues and you can avoid most of the carnage and be there to profit from everyone else’s misfortune.

Keep your cool during times like this and making money is pretty easy.


Much like the indexes, TSLA gave us a nice buyable bounce Monday.

If we sold the violation of $1k support last week, we were sitting on a pile of cash looking for the next trading opportunity. And as luck would have it, it only took two trading sessions for TSLA to give us the next entry point. Buy the bounce with a stop under Monday’s lows.

Maybe this bounce holds or maybe it doesn’t. But someone that bought the $850 bounce is already well ahead of the TSLA owner that held this retreat from $1,200.

Profit comes to those willing to act. Everyone else gets left holding the bag. Don’t be everyone else.

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Jan 24

Why savvy traders knew Monday was going to end in a sharp bounce. Plus the next trading opportunity in Bitcoin

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

If a person only looked at the S&P 500‘s closing print, the 0.3% daily gain completely obscured one of the most shocking trading sessions in nearly two years.

The index crashed 4% in midday trade, easily shoving us into correction territory (a pullback greater than 10%). Last week’s aggressive selling over rising interest rates devolved into a full-on, panicked dash for the exits on Monday.

But just when all hope was lost, an impressive rebound erased every single dollar of those midday losses. As jarring as the crash was, the rebound was even more spectacular.

All told, we covered more than 8% in a single session. You have to go back to the depths of the original Covid crash to find something this wild.

But to be honest, Monday afternoon’s “shocking” rebound wasn’t all that shocking to those of us that have been doing this for a while.

Monday’s early 4% crash was far and away the largest losing session of this correction. And during periods like this, the critical thing to keep in mind is emotional, waterfall selloffs typically capitulate on their biggest down days.

And guess, what? This emotional, waterfall selloff capitulated on its biggest down day.

Who could have seen this coming??? Oh yea, that’s right, readers of this blog knew it was coming. As I wrote last Friday:

Emotional sellers panic, get out, and prices bounce hard not long after. This story is as old as trading itself.

Odds are good next week will enjoy a meaningful bounce. Selloffs that go too far in one direction inevitably end with a snapback that goes too far in the other.

Maybe the market bounces Monday. Or maybe it happens Tuesday. Either way, nothing is going to keep me from jumping aboard that next big rebound.

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The best part of using trailing stops means we sold at much higher levels and were sitting on a giant pile of cash coming into Monday. While everyone else was losing their mind over this selloff, we were eagerly eying those huge discounts. Rather than get sucked into the herd’s panicking selling, those of us with cash were waiting for the capitulation bounce. And you better believe I was scooping up those crazy discounts Monday afternoon. (A critical note: Fools buy dips. Savvy traders buy bounces. Don’t be a fool.)

Maybe Monday’s capitulation bottom is the end of this correction. Or maybe it is just another false bottom on our way lower. Either way, it doesn’t really matter to me. I picked up some attractively priced stocks Monday afternoon and those positions are already sitting on a healthy profit cushion. If the correction resumes, no big deal, I get out at or above my entry points and try again next time. But if this is the real bounce, I will be counting my profits while all of Monday’s emotional sellers are left wondering what just ran over them.


I’m not a big fan of Bitcoin, but I know a trade when I see one. Bitcoin has been mirroring the equity indexes lately and if stocks are bouncing, expect that resilience to carry over to cryptocurrency. Bitcoin’s latest buy is buyable as long as it remains above Monday’s intraday lows.

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Jan 21

What happened the last time the index fell nearly 6% in one week and what does it tell us about what comes next?

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

The S&P 500 crashed another 1.9% on Friday, leaving the index down nearly 6% for the week.

It’s hard to believe we were sleepily notching record highs little more than two weeks ago. But that’s the way this usually goes. Few things sour faster than the market’s mood.

This rout in the equity market was initially triggered by an “unexpected” jump in interest rates. (I put unexpected in quotes because seriously, who didn’t see this coming??? Anyway…)

Since the market doesn’t do things in half measures, rather than respond to these changes in the bond market thoughtfully and deliberately, the crowd started impulsively rushing for the exits. Not because they thought a few basis points increase in Treasuries was going to wreck the economy, but because they assumed other people were going to panic. And logically, the only thing to do in those situations is panic first! Or at least that’s what happens when we let our lizard brains take over.

Now we find ourselves down 9% from those highs two weeks ago and the question becomes, what comes next?

Well, if we pull up a weekly chart and look back a little more than a year, we see a similar weekly plunge in the stock market (-5.64%) back in late October 2020.

That was the week leading up to the election and traders were afraid of what a President Biden would do to their taxes and regulations. Given how big the “Trump Rally” was, it makes sense the business environment could swing the other way if a Democrat took over.

Sell first, ask questions later was the name of the game back then, just as it was this week. And you know what happened next? Yeah, the market rallied 7.3%, easily erasing all of those prior losses and adding an extra couple of percent just to further humiliate all of the prior week’s impulsive sellers. Ouch!

But that’s the way this usually works. Emotional sellers panic, get out, and prices bounce hard not long after. This story is as old as trading itself.

With the index already down 9% from recent highs, is that low enough? Probably. While I don’t expect a repeat of 2020’s 7.3% snapback, odds are good next week will enjoy a meaningful bounce. Selloffs that go too far in one direction inevitably end with a snapback that goes too far in the other.

Maybe next week’s bounce isn’t the real bounce and panicked sellers are correct that this couple tenth’s rise in Treasury yields will lay waste to the US economy. But odds are good they overreacted just a tad this week.

Now for how I will trade this. I never, ever buy dips. That’s a fool’s game. But bounces? Yes please!

Maybe the market bounces Monday. Or maybe it happens Tuesday. Either way, nothing is going to keep me from jumping aboard that next big rebound.

And now for a quick rant: anyone selling on Friday is an idiot! There are only two ways to handle these situations. Either we sell early or we hold through it. Only fools wait until they get too scared and then impulsively dump everything near the bottom.

The really isn’t that hard! Back on January 5th, I warned readers that smart money was selling:

Sell and see what happens from the safety of the sidelines is how I’m approaching this. If prices bounce Thursday, great, I’m getting back in. No harm, no foul. But if the selloff continues, even better, I wait for the next bounce and buy at even lower prices. That’s a win-win in my book.

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Well, here we are two weeks later and 350 points lower and I’m sitting on a big pile of cash itching to get back in the market.

I tested the water with a couple of small buys since then, but every time selloff started making new lows, I got out and waited for the next bounce. And the lower we go, the more excited I get. We’re going to make some good money next week. I can’t wait!

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Jan 20

Why smart money was buying Thursday morning’s bounce. Plus, why NFLX owners only have themselves to blame

By Jani Ziedins | End of Day Analysis , Free CMU

Free After-Hours Analysis: 

Thursday’s session for the S&P 500 was far more dreadful than the day’s 1.1% loss suggests.

The day started off well enough when the index popped nicely at the open and rallied all the way to 4,600 support by late morning. But rather than propping up the market, 4,600 turned into a ceiling and that was as good as it got. By the end of the session, the index shed 120-points from those intraday highs and crashed through recent lows. Ouch!

But if Thursday was such a dreadful session, why were savvy traders buying that morning bounce?

The answer is simple, it gave us a nice, low-risk entry and it would have been foolish to not take it.

All too often novice traders fixate on whether a trade worked or not. But what these rookies fail to realize is a good process is far more critical to long-term success than the result of any individual trade.

For example, if an eccentric trader bought far-out-of-the-money call options based on an astrology chart, just because the trade worked for him that single time doesn’t mean it was a good trading decision.

While people often claim it is better to be lucky than good, the problem with luck is it always runs out.

Stick with a good process and we don’t need luck, we just need to be smart enough to stick with it.

Even something with an incredible 80% win percentage will still fail one time out of every five. Does it make sense to throw out a highly reliable process simply because it didn’t work that one time? Of course not.

And the same goes for buying this Thursday morning’s bounce.

Now, don’t get me wrong, buying bounces doesn’t work 80% of the time. Not even close. In fact, it only works about 30% of the time. But the win percentage isn’t the genius of the trade. It’s the unbelievable risk/reward these setups give us.

Buy the bounce early with a partial position. When prices continue higher, as they usually do, move our stops up to our entry points. Bam, this just turned into nearly free trade.

If Thursday’s bounce returned to the highs, like every other dip has over the last 14-months, that’s 200 points of profit in our pocket. If the bounce stalls and retreats, like it did Thursday, we get out at our entry point for what we paid. No harm no foul.

So a trade with 200 points of upside and close to zero downside? Who cares if it only works 30% of the time, we should be buying it every chance we get.

This is why smart money was buying Thursday’s early bounce.

And you know what? I will do it again Friday if we get the same setup. Except this time there will be 300 points of potential upside if we return to the highs. Bring it on!

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NFLX got hammered after the close following disappointing subscriber growth. While the after-hours losses put the stock back to $400, that’s a long, long way from the $700 autumn highs.

But here’s the thing, savvy traders are not taking tonight’s 20% haircut. This stock has been in free-fall since failing to hold $600 support at the beginning of January. If a person didn’t sell the first $600 violation, there was no excuse to keep holding after it fell under December’s lows.

Big selloffs like this are many months in the making and while it feels like it hits us all of a sudden, anyone caught up in this ignored a lot of very obvious sell signals. I mean seriously, the stock gave us THREE chances to get out at $600!

And while it feels like this cannot possibly get any worse and it has to be close to a bottom, just ask a PTON owner how much lower these things can fall.

I like NFLX. They have a great product. But this is a momentum stock and the momentum is clearly in the wrong direction.

I’m more than happy to buy the next bounce, but it needs to bounce first.

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Jan 19

Has this selloff gotten bad enough to be good yet?

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

Wednesday turned into another painful session for the S&P 500 as it shed an additional 1%. This leaves us 5% under recent highs of only a couple of weeks ago. Easy come easy go…

But Wednesday’s follow-on selling wasn’t a surprise. As I explained to readers Tuesday evening:

Emotional selloffs rarely kiss support and bounce cleanly. Get this close and a more painful violation is all but inevitable. While there are no guarantees in this business, the risk/reward is definitely stacked against us. As the prudent saying goes, “never try to catch a falling knife.”

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We got a modest bounce Wednesday morning, but the dip-buying barely lasted an hour before another wave of selling knocked us under 4,600 support for the remainder of the session.

While that early bounce was technically buyable, as soon as prices undercut yesterday’s lows, it was time to get out. As easy as it is for independent traders like us to get in and out of the market, there are no valid excuses to continue holding a falling market. That was true two weeks ago when this selloff first started and it remains just as valid today.

Now that most readers are safely in cash, we cannot allow ourselves to sit back and relax. Instead, we are always looking for that next buyable bounce.

Stocks bounce hard and fast from oversold levels. While only fools try to pick bottoms, if we wait more than a few hours after a bounce, we quickly find ourselves getting left behind.

Start small, get in early, keep a nearby stop, and only add to a position that is working. Follow those simple rules and you too will profit from the next big rebound.

And if the next bounce turns into another false start, no big deal. We simply get out at our nearby stop and wait for the next bounce.

By starting with partial positions and having clearly defined exits under recent lows, buying these bounces is a low-risk proposition. Compared to the potential upside of riding this 5% dip back to the highs (15% in a 3x ETF!), I’m more than willing to take a few small and calculated lumps along the way!

This is a numbers game. As long as we stick with our trading plan, we guarantee we will be standing in the right place at the right time when the real bounce finally takes hold.

This will only bounce after most people have given up. That means we need to be more persistent than most.

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Jan 18

Why savvy bulls are cheering for a bigger pullback. Plus GME is showing its true colors.

By Jani Ziedins | End of Day Analysis

Free After-Hours Analysis: 

Tuesday was another painful session for the S&P 500 as the index shed 1.8% and failed to hold 4,600 support.

Low keeps getting lower and that’s never a good sign. While Tuesday’s selling didn’t spiral out of control after undercutting last week’s intraday lows, that’s a silver lining at best.

Emotional selloffs rarely kiss support and bounce cleanly. Get this close and a more painful violation is all but inevitable. While there are no guarantees in this business, the risk/reward is definitely stacked against us. As the prudent saying goes, “never try to catch a falling knife.”

I came into Tuesday’s session holding a small position I bought following Friday’s late bounce. I liked Friday’s setup and more often than not, those things work. But “most of the time” is not the same as always, so that’s why I only started with a partial position.

When the market gapped lower Tuesday morning, I took my lumps and got out. But doing it with a partial position wasn’t all that bad. Slippage like this is simply the cost of doing business in the market.

While critics will laugh at my “wrong” trade, in this case, being wrong is actually creating an even more profitable trading opportunity. Now that my trading account is 100% in cash, the lower this goes, the more money I make buying the inevitable bounce. So burn the house down for all I care. All I know is I will be there with a pile of cash to pick up the pieces. When the crowd is busy abandoning ship at the bottom of this dip and selling their favorite stocks at deep discounts, their loss will turn into my gain.

If the market bounces Wednesday, I will be there to buy it. If the bounce doesn’t come until next week, no big deal, I can wait.

Start small, get in early, keep a nearby stop, and only add to a position that is working. If the next bounce keeps going, great, I add more. If it turns into another false start, no big deal, I pull the plug at my stops and wait for the next one.

The most important thing is I keep at it. All of these small, partial position losses will be wiped out when I’m standing in the right place at the right time and catch the next big wave.

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A handful of weeks ago GME was challenging $250, now it is barely hanging on to $100.

When moment stocks fall, they fall hard. Unfortunately, there is no indication GME is anywhere near a bottom. It is down 80% from all-time highs and it is acting like it could fall another 80% from here.

If Christmas and NFTs couldn’t save this stock, I don’t know what is left to turn this around.

But remember, as bad as this looks, it can always get worse. There is no rational reason to ride this one all the way into the dirt. And you know what? If it bounces, you can always buy back in. A more nimble approach like that definitely beats hoping and praying for a turnaround.

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Jan 14

When chasing your tail is the smart trade. Plus what to do with TSLA

By Jani Ziedins | End of Day Analysis , Free CMU

Free After-Hours Analysis: 

The S&P 500 went for another wild ride on Friday.

The index gapped lower at the open, but as is often the case with opening gaps, supply dried up within minutes and prices bounced back to breakeven. (I’ll get into the reasons why this happens so often in another post. Sign up for free email alerts so you don’t miss it.)

Unfortunately, the relief was short-lived and prices quickly slumped back near the opening lows when dip buyers failed to show up and support the early buying.

But rather than crash through the lows and trigger another wave of panic selling, supply dried up for a second time and the index actually bounced back to breakeven, even managing to eke out a small, 4-point gain by the end of the day.

Phew, that was a mouthful and it was definitely a topsy-turvy session. But what it wasn’t was another rout. Bears had the perfect setup to launch another big wave of panic selling, but they couldn’t get stock owners to play along. And that’s a pretty good indication bulls are still in control of this market.

As I often remind readers, it’s not how we start but how we finish that matters most. And while it is hard to get excited about a measly 4-point gain, that is actually a respectable win given where the index spent most of the session.

In fact, I was encouraged enough by this price action to start buying back in. If this market was fragile and vulnerable to a larger collapse, it would have happened Friday. The fact we closed well above early lows tells me this market wants to go higher, not lower.


To the untrained eye, it looks like I am chasing my tail these last two weeks because I keep getting in and out of the market. (And it definitely feels like I am chasing my tail!)

I sold the initial dip at my stops in the upper 4,700s. Then I bought the first bounce late last week but ended up getting dumped out during last Friday’s pathetic close. I tried again this Monday, buying that impressive bounce. That trade worked well until Thursday’s interest rate second-guessing told me it was time to get out again. And then as I wrote above, I bought back in Friday afternoon.

I hate buying and selling this often. But that’s what my trading plan tells me to do at each of these junctures and I know better than to question my trading plan. When done right, my trading plan A) keeps me safe and B) makes sure I am in the right place at the right time to take advantage of the next big move.

If that means I have to chase my tail every once in a while, so be it.

While I collected a small profit this week arbitraging these whipsaws, that’s not the reason I’m selling these dips and buying these bounces. I’m doing it to protect myself from a larger selloff.

I will be the first to admit I can’t predict the future and I don’t know if this pullback will bounce at 4,600, 4,400, or 4,200. What I do know is it doesn’t matter if this is a 200 point pullback or a 600 point pullback, I don’t want to hold through either of those pullbacks.

When I move to the safety of the sidelines, I no longer care if it is a 200 point or a 600 point pullback. And as soon as I’m in cash, the first thing I’m doing is looking for the next buying opportunity so I can get back in.

Maybe Friday’s buy will prove to be a mistake. And I’m okay with that. I simply get out and try again. Or maybe the market bounces nicely Tuesday and I add more.

Either way, it doesn’t matter to me as long as I’m standing in the right place at the right time.

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TSLA took a big hit Thursday, but more importantly, the stock held $1k support.

While it is more fun watching a stock go up every single day, we know that’s not realistic.

TSLA is trading well enough to stick with as long as it remains above $1k support. In fact, for those that missed the first bounce, this pullback is giving you a second chance to get in.

Buy the bounce with a stop just under support.

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