Huge drop today yielded one of the better days of the year for myself and other shorts. Many trades worked really well today. However, I would point out one poor decision of cutting my index shorts this morning because the market dropped lower and closed on its lows. One could say that I shouldn’t complain of capturing > 2% in the indexes, but this is what I do and I have been saying that we would get some more oversold condition and I still don’t think it hit today. The best move I made though was not covering after yesterday’s hard to sit through up move.

From me venting yesterday:

“Will we bounce? Maybe, yes its happening now, but maybe more, maybe we get a reversal. Who knows? I know 3 weeks from now we should and will likely be lower. Sticking to it as painful as that friggin is.”

It paid off. Some people make their whole year on days like today and for guys like me this kind of index action is about 3 days of correct trading - A huge advantage at the year end if you either avoided today or got it right compared to taking the hit.

Things that worked today…

My ABX trade. These calls closed up 200% to $1 over yesterday’s close, but I didn’t get in there. I got in at .60 and sold for .75 - 25%. I think there is a lot more left in the gold trade. Try to remember how early I get out of things.

FXP - I posted a few charts a few posts ago, gained over 10% near the close, but settling a little lower to 9.5% gain on the day. Thats a really nice move and knew it was coming. The problem in my trading of FXP is that I bought some FXP on margin yesterday Pre-Fed and had to cover post Fed taking a small loss. I sold all of my FXP today and that might be a mistake too.

TWM - Captured around 2% in that. I also sold out of all my TWM in case of an up open tomorrow - which I will repurchase if that happens.

SRS - The best of the bunch in terms of gains on the overall trade. 5.5% gain. I sold SRS. This chart looks good and I plan on getting back in.

ABAT - One of the few green stocks today in the market (along with CROX lol). 13% in this tape are you kidding me? Something is going on there. I kept my ABAT. Up 7.5%

CVS - Got siiiiiimashed today off that BS bounce yesterday. Not in this one, but the call was right.

I said three days before this downdraft that the tide has turned and that broad short ideas going forward is going to be easier than swimming against the current with long ideas. Today is confirmation. Short is the place to be. Short the rallies until we see a turn. Hopefully these few sentences will save and make you some money.

Thanks for reading

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