Market Crash Imminent?

Hi Folks, Just another update. I am still bearish on the market. I believe the selloff begins before the end of the year. Chart wise, the end of September looks particularly bad. It looks as though something bad is going to happen. Maybe terrorism? I really think people need to protect their portfolios going into the next few years. Since my last post the market has traded sideways allowing the moving averages to catch up so the stage is set for a potentially massive sell off. One possibility based on Fibonacci's is an 80% correction. Ouch!! Below is a chart with the Fibonacci drawn on it from the 2007 high to the 2009 bottom. You can see the market hit the 161.8 on the button.

Thanks and Good Trading, Tim

The Next Big Stock Market Crash

Hey Folks,

Once again it has been awhile since my last post. Happy New Year to everyone. I'm not going to make any promises about more frequent posts this time.
The markets have had quite a run since the '09 lows but all good things must come to an end. I believe we are at the beginning of a significant market sell off. What will the catalyst be? Maybe a student loan crisis, rising rates, collapse of the dollar, terrorism or political unrest. I have no idea. All of my opinions are based on technical analysis not news or events.

I believe that SPY(SP500 ETF)will be cut in more then half over the next 1 - 2.5 years or so. My target is 85 and it's currently trading at 204.

So what do you do? If your portfolio is with a broker, typically you can only have 10% of your portfolio short. You could buy SDS which is a
n inverse ETF for SP500. So as the SP500 goes lower SDS goes higher. If you have a portfolio of stocks, you could use options to "collar" the position off. Here is how that works. Let's say you own 1000 shares of CBS at $55. You would sell 10 Jan 2017 65 calls at $4 giving you $4000 to buy 30 Jan 2017 35 puts at $1.30. Then if CBS falls to $25 over the next 2 years, you break even plus you keep the dividend. If you didn't hedge your position you would be down $30,000.

I may be a little early since the longer term moving averages are still trending up and have not started to flatten or roll over yet but i feel the top is already in. With this pattern we should move lower towards the October lows then run back up and then the big sell off begins. So time frame wise maybe March.


Thanks and Good Trading,


Tim

Long WLT

Hi Folks, I sold NAVB for about a 10% win today and bought WLT. Thanks and Good Trading, Tim

NAVB

Hi Folks,
I got long NAVB at $1.87 today. Target is $2.30.
Thanks and Good Trading,
Tim

NIHD

Hi Folks,
I sold out of the NIHD position today at $3.24 for a 27% gain in 2 weeks. Target is really $3.64 but a 27% in 2 weeks I don't want to get greedy. I'll keep you posted on the next trade.
Thanks and Good Trading,
Tim

NIHD

HI Folks,
I sold out of the AMRN today at $2.08 for a little better than a 10% gain. I got long NIHD at $2.55 this morning.
Thanks and Good Trading,
Tim

Day Trading Using Weekly Options AMRN

Hi Folks,

I sold out of the MCP position Friday at $5.56 vs. purchase price of $4.73 for a 17.5% gain in 2 weeks. Now I am looking to get long AMRN for a ride up soon. This could be a big move currently at $1.82 towards $3.50. Most of the trade set ups I talk about here are in the 2 to 6 week range.
Thanks and Good Trading,
Tim