Wow-w, what a stunning performance! Up 12 sessions in a row, and the Bull Flag/Falling Channel target of 1605.63 got MADE within a half a point. Per Mark's question the other morning on longer-term trades, if I were playing the NAZ via something like the QQQQ or the QLD, or individual stock components, I definitely would take at least some profits when that target got MADE.
In addition to the 956.23 target getting MADE this week, the Symmetrical Triangle (pattern in purple) target of 971.57 from the June 1 breakout finally got MADE in yesterday's rally.
This chart is an excellent illustration of a Bear Trap (at the July 8 low), and how it gets sprung. That low was at neckline support of the 4½ month Bullish Inverse H&S breakout, shown in previous charts.
When the SPX got back above the neckline of the putative H&S Top (which wasn't a H&S Top) at 893 where I threw in my SDS long position (also shown in previous charts), that was the first sign of "Uh-oh" for The Bears. The next "Uh-oh" was when the SPX broke out of the Falling Channel, crossing 916.293.
Staying short, or shorting, an upside technical breakout is very ill-advised, and we can see why. If I had stubbornly held onto my SDS long postion because of some opinion that I had, or because of some prediction that I had made, or because I allowed some indicator to tell me what to do, I'd currently be under water to the tune of about $25,000, or worse, if I had kept adding to my position. UGH.
Speaking of stubborn, "The stock that STUBBORNLY refuses to die" sold off about a buck in early trading, but as is its wont, Goldman came roaring back and rallied with the rest of the market. The Bull Flag target of 165.09 got MADE. What a monster this stock has been, up 251% off it's November, 2008 low. Whew!
Kudos to Meredith Whitney, by the way, for her upgrade of Goldman when it was at $141. Her posture on the financials has been bearish, but she correctly recognized that Goldman, specifically, had upside potential and it has rallied $25 since her upgrade. I admire and appreciate it when an analyst makes an effort to be objective.
Like Goldman, AZO sold off in the early going, but unlike Goldman, it didn't rally much. It got back in the green, but languished all session. Unfortunately, I bought AZO instead of Goldman :(
In the final half hour of trading AZO was barely in the green, looking like it was going to sell off, so I threw it in and was glad that I did. AZO closed slightly in the red. Now, watch it rally to $160 today ;)
Despite closing in the red on a big up day in the market, AZO didn't do anything wrong, technically, so it still could rally here. My decision to throw it in was predicated on the fact that I had paid a premium to the best entries into the stock because of the pattern breakout and because of the successful retest of the pattern breakout, so I really, really didn't like it lagging on such a strong day in the market when it had every reason to rally along with it, technically. Blah-h...
Don't you just love it when the market has a HUGE rally, and the stock that you're long is one of the few that closes in the red? LOL.
Gain: $250
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