All is well as we start the first trading day of 2017 with SPY gapping up .67% and QQQ +.75%.
The selling we saw the last few days of 2016 could not only have been related to some of the geopolitical issues discussed but also tax loss selling into year end.
I am long 1/2 a position in SPY via SSO and am sitting pretty good if we get a rally from here. Looking back over 2016 the best performing trades have been the index setups accounting for most of my gains.
Breakout trades have been hit and miss while break and reverse trading has done much better.
This year I plan on staying with what worked last year with a few adjustments on my exits. I plan on using the 20 day MA on the 240 min chart as my exit on a close only basis on all BO trades. Although I plan on monitoring the 8 EMA on the 240 min chart as an alternative exit close only.
One thing you have to consider when trading is that if your stops are too tight it will doom your success. One of the hardest things to determine is stop placement so that is what I am going to concentrate on this year. Entries are easy:) It’s getting out of the trade that is what determines your profitability!
I am going to spare you all today my geopolitical analysis as I went into it in detail yesterday. If you did not read that post and are interested in how geopolitical events could influence the markets this year, take a look.
We have 17 more days before the transition of our government. I do not expect the period to be peaceful with no surprises. So stay alert.
If you want to follow some of my trades along with my thoughts typically given after the open you can go to @rickjswings. Typically I talk about the overall day expected with the markets and also give some levels on the ES and NQ for failed breakout scalping.
It’s my private twitter feed for the stock market and its free. Sports Handicapping is the subscription-based part of this site. But considering the cost of joining it’s almost free:)
Good Luck Today
RickJ’s Handicapping Picks