For the first time since the blizzard of 1888, the stock markets will remain closed for two normal business days in row. No subway either. I admit I'm not exactly sure what effect this might have on the rest of the week. Will there be higher volume due to built up demand or will everyone be unsure and sit it out until Monday? They both seem plausible to me. Not to mention the election is right around the corner.My margin cleared Friday, so I decided to take on two long positions. I purchased 100 shares each of Allot Communications (ALLT) and U.S. Airways (LCC). I chose ALLT due to a 4.7 percent drop Friday, putting it outside it's Bollinger bands. Every time it incurred such a steep drop in the past two months it has either had a big up day the next day, or moderate improvements the next two days. I plan to swing trade any bounce it has and get out before it has a chance to sink lower.
LCC has had a lot of visibility lately with talk of merger and it has been enjoying an underlying uptrend despite the overall market correction. Often, when a stock has upward momentum in spite of a correction, it can break out once that downward market pressure subsides. I see this position doing one of two things. Being closed to make room for more short positions, should next week renew the slide, or sticking around until mid-December.
Overall, I'd say I'm -1 the market right now, though I haven't taken on any short positions to match that outlook. It has been volatile and mixed lately, making it hard for me to decide out long this correction will last. However, if next week there are signs it will continue, look for me short stock, probably in the technology sector.
Later in the week we'll look at some charts and see where things are going.
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