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I won today, but it doesn’t matter.

What matters is good trading behavior.

Yesterday I pointed out some important items that proved fruitful for today’s move see charts from yesterday’s post. Let me first say I did not think we would see a -268 Dow print today. I was expecting what we got in the morning which was -80/-100. That is where I sold my USO puts, FAZ, SRS, SPY puts, V calls and CSCO puts.

I screwed up the V calls because I sold them at market early in the day and got the shittiest price ever for them. Shouldn’t have even been a loss – just dumb. It was small though as the position was small.

CSCO – I just decided to eat the loss. If I held all day which was the right plan, I would have lost very little, instead it was a 67% loss on these puts. Position was larger than V, but way smaller than any of my short trades. I trade larger with the trend and take small shots at counter trend.

USO – puts would have been a 82% gain, but I got 2.2%. So dumb.

I have somewhat of an excuse – I’m traveling.

The SPY 60min chart was so money yesterday…

The daily charts are oversold again, I don’t know what to expect tomorrow. Either way we are most likely to setup now another buy at the close Friday into Monday. Probably tomorrow we gap lower and fill the gap to consolidate at the bottom of the deep candle made today. Tuesday or Wednesday next week should be higher maybe even half into today’s candle by then. Similar pattern as last Friday and move higher to test the 50 and 21 dma’s. That is the bullish scenario.

The bearish scenario would require a relief rally tomorrow. Enough of a move to relieve daily oversold conditions from yesterday and remove weekly oversold conditions. This would setup a nice down move next week.

IMO, the bullish scenario is more probable and not because most people don’t think it will happen.