After Tuesday's near 3% selloff, the sentiment changed to bearish. It got confirmed the following day on social media. But the low of Thursday brought buyers in. I was surprised to see the big buying tail despite the 2.98 million unemployment claims which was much higher than the 2.5 million expected. -16.4% of retail sales v.s. -12% expected in April didn't deter the bulls today. IWM/RUT rose 1.6% while SPX gained 0.4%. It's a down week overall but there is a big buying tail on weekly. The uptrend held at the support. MACD is flat in daily, near cross up in weekly. It's a tricky market right now. Many heavyweights have been calling for another leg down. It hasn't happened for weeks now. We may see more choppy price action or another drop after retesting the breakout area.
My net liq was below 100K early this week. It finally got up to 100K yesterday. The leverage is still above 50. I was able to roll my next week's long put out for another week. I was going to do a risk reversal in SPX. Glad I couldn't do it on Wednesday due to the net liq shortage. My last client, Lao Don had to take his big loss of $76K on Thursday since his net liq is on 42K. My failure was realized. My account is still a time bomb out there.
I have to be proactive. Should I close most of the long positions before a possible next leg down?
I signed up with Shadow Trader to learn more about this option practice. I plan to get on with the Insight Trade which is a more expensive, directional approach. The reviews seem positive.
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