I am starting to average into a DIA short. The DJIA has been the laggard index and it is now bumping into what should be an area of more significant resistance. I'm probably a bit early and I plan to make a total of 4 sales into this average on the way higher and may broaden to the SPY as well. This will be my hedge as I can hold overnight and won't get hurt. I suspect that the pullback, when it occurs, will be to violent and out of the blue to work as a trade on the futures. So, I'll turn to the ETF instead. This is all about money management now and how you want to work your positions. I'm taking a two pronged approach. I'm slowly moving the bulk of my holdings into the oils on the long side until we get a good pullback. Secondly, I'm going to average into a hedge we can hold for a week or two if needed until we get that pullback that will allow us to stay in our other long positions.
One last thought. Those FOMC meeting notes should be bullish for the precious metals. Rather than chasing back into a number of positions in that sector, I jumped into a larger NEM position as it's the lead dog in that group and it still has a breakout ahead of it and thus isn't too extended yet.
One last thought. Those FOMC meeting notes should be bullish for the precious metals. Rather than chasing back into a number of positions in that sector, I jumped into a larger NEM position as it's the lead dog in that group and it still has a breakout ahead of it and thus isn't too extended yet.
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