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First the good. Since my last post last Thursday, “Beware of the Long” the 2x funds have gained nearly 15% in the $RUT and not exactly sure what for the $NDX but probably in the neighborhood of 9%.

I kept my index funds short, I was contemplating between cutting them 100% to cash or just cutting 50%. I decided to wait until the morning, hoping for a hammer related day where I can get out at a lower price than today’s close. Futures right now beg to differ.

The bad. It all started out in the morning. Being long an EWZ put spread, DRV, TZA, EPV, EDZ, and SDD. Sounds great considering how the market closed. Here is how I fucked it up.

So the market was up mildly in the morning, and the futures recovered from a disastrous overnight low and due to that my mind was really f’d up because of that. Most likely due to my position sizing. I was 100% short. I was absolutely shocked we did not open lower. Everything I had said we should be down today (remember I’m talking about how I was thinking at 9:30). So I sell all my shorts, the TZA, DRV, EDZ, EPV, SDD, EWZ puts, and am sour enough to stop trading for a whole 30 minutes (joke). Right off the bat down a pretty decent amount and I’m already dejected. I had my Rydex funds trade as my back stop to my whole lower close theory, so sometimes that gives me the excuse to slack on decisions with the equities.

I then tried at different points to get long SPY puts. Yeh the market went down today so how do I screw that up? I’ll continue. So I often trade SPY puts and play for anywhere from 5 or more cents. So I would buy some puts and if it didn’t go my way almost immediately I would take my loss. I also had some winners, but it wasn’t enough to overcome the losers. Most annoying trades were the SPY 107 puts I paid 2.88 for and they ended the day at 3.62. The SPY 105 puts I paid 1.99, 2, 2.02 several times and they closed at 2.62. Meanwhile all my charts were red. Best move would’ve been just sit with the original trades based on original setup.

It might be because I’m sick and recovering from being sick. I don’t know, but it was stupid trading.

Is the market oversold here? A little bit and I stress a little bit oversold. There is a daily RSI divergence on the SPX at the close today. Other than this, it is absolutely the perfect spot to start an untechnical phantom bounce from that will setup a better short. Rallies should still be shorted until the trend changes. Alot of charts had some stiff wedge breaks today.

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