Michael Huang
Short

Thursday Bounce Into Top of Uptrend Channel

AMEX:IWM   ISHARES RUSSELL 2000 ETF
89 6 1
Some very short term upward momentum in IWM             should bring it up to around 116 tomorrow. After it reaches the trend channel top it should fall sharply as it continues its negative divergence and moves with the larger downtrend. I very highly doubt that IWM             will hit the bottom soon as SPY             and QQQ             have not quite started to follow down with IWM             .

I plan on buying ATM Monthly puts on IWM             once it reaches the top of the trendline in order to minimize my risk. I expect the end of the week to be further down from here. If it does not reach the trendline I will wait a while to buy cheaper stocks .
Will Wong
2 years ago
Busted through the trendline. Now what? Maybe it will come down and retest the trend (support) line.
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Michael Huang
2 years ago
Well, it hasn't knocked out my stop yet, but I'm guessing It could pass it briefly tomorrow. I think it will likely pull back before close. I am still bearish on this and still holding december puts. If it doesn't fall before New Years, it will definitely crash after... I think the market is insane for needing a Christmas rally and then dropping it like an unwanted stepchild afterward.

If it just keeps going up I guess all I can say is that I was wrong. It's impossible to predict the market completely but I think its ridiculous people ignore stocks valuations and earnings. The market is horribly overextended right now and there isn't much a smart person would want to buy at the moment.
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levrage Michael Huang
2 years ago
This was a frustrating day, I very much hope your thesis holds, for both our sakes.
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Michael Huang
2 years ago
FML
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stockSMASH
2 years ago
some very niceand accurate calls last few months. impressive... 6pm Sunday.. futures opened down 10 on spx preciously that has meant nothing but I suspect big boyz did some serious selling last week as dumb money bought with glee. I am long tza and short IWM... I think that trade will work and IWM will test 101 and more?, matter of when and how fast... DO YOU HAVE A TARGET? reply appreciated and thank you for your posts.
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Michael Huang stockSMASH
2 years ago
Honestly there has just been a lot more buying pressure from buyers at the end of the year than I expected. I probably should have respected the end of year tendency of a rally a bit more. I think that this month will have either sideways movement or a continued uptrend. I would then maybe bet short at the beginning of the year or wait for a nice pullback to buy stocks depending on your risk aversion. I think at the beginning of the year we will see a nice pullback.
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