Hello! This is my first post here.
Last Friday AAPL reversed nicely from the sharp sell off near 657.25 and closed at 665 on good volume, setting a good tone for today’s strong action, especially on the first day trading in Sept. after Labor Day weekend. The volume today is higher as it closed at day high near 675. Only 6 points off year high 680.87, which was seen last Monday on the verdict news. Also market closed off the day low while Vix retreated from recent high 19 area. VIX has risen for the last two weeks though.
I played $AAPL long with weekly ITM $650 call to capture its big points of upside move. Its intraday chart had a nice cup and handle formation which gave me the upside target 675 to sell into. I consider the big resistance area 675-681 still for AAPL. I’d rather keep power dry as it’s been swinging wildly for us to trade accordingly.
Despite some new highs seen on top-rated stocks by IBD, some commodity related stocks continue to drift lower to their new lows, such as CAT, CMI, X, CLF, JOY, WLT, etc. amid economic slowdown in China. After hour today, FDX issued warning for next Q1, not going to help tomorrow’s market. Big divergences between winners and losers are my concern, and also most technical indicators on the S&P I follow have been bearish. September has history being weak, and especially the coming triple witching day, 21st of Sept. could be much weaker compared to the first and fourth quarters.
The latest AAII Investor Sentiment Survey shows individual investors sentiment toward stocks has perked up. Long term bulls (39%) outnumber bearish (30%) and neutral (31%) investors, somewhat a contrarian indicator.
Don’t chase higher flyers as the bullish runup since early June has been aged, or catching falling knives is not smart to do. Be objective, flexible, sell on the way up and protect gain. For active traders, as long as stocks swings, we take advantage of it, of course, always be careful with fast and furious swings dominated by HFT.
Trade safe and trade well!