Weakening Wednesday – We Are Loving Our CASH!!!

Don't say I didn't tell you so…

If you don't cash out when the markets are making silly highs then you end up having to scramble like an idiot to cash out when everyone is panicking and you get MUCH WORSE PRICES for your stocks and options.  The same thing goes with hedging – as it's MUCH CHEAPER to hedge when the market is going up and no one thinks it's going to fall.  You have to have a bit of contrarian in you if you want to learn to be a good investor, following the herd all the time just makes you one of the sheeple.  

The wolves who read yesterday's PSW Morning Report not only picked up the $2,000 per contract-winning Nasdaq (/NQ) short but also $500 per contract gains on the Oil (/CL) and $500 per contract on the S&P (/ES) (and, if you'd like to get these trade ideas pre-market, you can SUBSCRIBE HERE) based on these very simple instructions:

Since the Dollar has been holding things up, today is a good day to short Oil Futures (/CL) at $72.50 for a quick dip but get out before the API report this evening.  We're just looking for a quick win with VERY TIGHT STOPS above the $72.50 line.  The whole key to trading the Futures is having a good backstop so you can limit your losses.  6,950 on the Nasdaq (/NQ) is also a good line and 2,740 on the S&P (/ES) makes a good stop line with shorting below as we're at 2,738 this morning and it's my contention that 20 points of that is due to the Dollar so we'll look for at least a 10-point drop, to test the strong bounce line at 2,728 again – and that's up $500 per contract against the $100 risk at this level.

This morning, we're way down at 2,708 and that's a 30-point drop on the S&P at $50 per point, per contract so $1,500 gains if you stuck with that hedge overnight.  In addition to those pre-market plays, we also picked up shorts on the Russell (/TF) and we double-dipped on Oil (/CL) later in the session.  All in all, it was a…
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