CHASING DREAMS...
I remember when I was young, my teacher always asked us what is your dream? What kind of job do you want to get when you grow up. My top choices was always Pilot and Engineer.
As I progressed in life, my eyesight started to deteriorate and I no longer have 20-20 vision when I was in Form 3. There goes pilot dream. And as I went further on, the next thing that deteriorated was my studies. I had gone from being top 3 student in primary to last 3 student in my secondary years. There goes my dream to become an engineer.
Do you face the same situation that one by one your hopes and dreams gets further away and at the end you end up doing whatever comes next. I ended up becoming an Accountant, which was not something I even thought off while I was young. It just came to me as based on my grades and points, the next best subject I could do was an Accounting Degree at a local university. Not that it is that bad at the end of the day as I got off to a great career and ended up as a CFO of a multinational corporation.
Ok, what I am trying to get is that, never lose hope and you can chase your dream with whatever you path brings you. It is just a destination and the destination never ends, new things comes along the way, new destinations where you want to go, "Chasing Dreams"....
Keep up on whatever you are pursuing and never lose hope....you will definitely reach your place as long as you continue to move forward!
SPX
Wow....SPX crossed 200 MA, Crossed 150 MA and ended the week with a bullish pinbar. 9 days uptick and the bulls keep supporting them up. Most stocks, including SPX is at oversold territory and a 9% recovery in less than 2 weeks is nice but still something which is a bit unbelievable with so many uncertainties still lingering around, eg. war, high inflation, pressure to increase rates etc.
I would be more comforted if the market make a bigger retracement before going higher. It did make some retracement last Wednesday but I was hoping it dip back to 50 MA before bouncing back. But it only went back below 200 and went back above the very next day.
Lets see if it can break 4600 points or face a resistance at that level.
NDX
NDX has gone up 13% in less than 2 weeks. It seems to be in a very overbought position and that the bulls are wearing out. Many of the NDX component stocks have been moving up and down for the past 2 to 3 days uncertain of the direction, but overall it is still moving up more than down.
AAPL went up 16% without a downtick since 15 March. AMZN recovered 23% from its earlier lows. MSFT & GOOGL up 12-13% and even FB is up 19%.
If any negative news comes in, I would expect also a hard drop down before finding support at the next moving averages below.
CONTRARIAN TRADING...
It is good to be safe. But sometimes, it also pays if you are moving against general direction. If market expectation is up, means as a premium seller, there will be less premiums to be earned if you are on market direction. However, if you are going against it, market can pay you more for taking the risk.
As most position, seems overbought, it would not be a bad idea if we put in some bearish position for stocks which has gone up by more than 15-20% in the last 2 weeks.
One of the better performing sectors in March is Healthcare. UNH has gone up around 15% since 24 February. If you are thinking that the upside may be limited or in overbought territory, a Bear Call Spread around Delta 23 for DTE (40 days) expiring 6 May -545C/+550C for $1.25 is not too shabby trade. However, UNH options price tends to be wonky and at times, the holding period may need to be longer to exit. Hence, risk may be higher for this counter.
Alternatively, you may also put in Call Broken Wing Butterfly for a credit on other stocks which may be overbought. Credit Call BWB has no risk to downside.
TRADERS TALK
Did you hear last week's Traders Talk?
We had a great topic and so much insight on trading was given out.
Listen to Traders Talk Series 41 if you have not done so. View Past Traders Talk
Remember to join us every Tuesday 7.30 pm on my Facebook Page. Follow-us so you will be notified when we go live!
This Tuesday, Traders Talk will take a holiday break!
Visit and follow us at our Facebook Page for more contents!
Access here >>Facebook Page<<
DISCLOSURES
Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options: https://www.theocc.com/components/docs/riskstoc.pdf
MYstyework is an Online Financial Literacy Educator and materials provided is solely by MYstylework and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, transaction or investment strategy is suitable for any person. Trading securities can involve high risk and the loss of any funds invested. MYstylework, through its contents, does not provide investment or financial advice or make investment recommendations. Investment information provided may not be appropriate for all investors, and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. MYstylework is not in the business of transacting securities trades or an investment adviser.
CONTACT
support@mystylework.com