Todd Horwitz Chief Strategist BubbaTrading.com
Be Prepared not Surprised.
Markets had a rough week with the Dow, S+P and Nasdaq slightly lower, the Russell clobbered. One week does not make a trend but there are certainly warning signs that indicate trouble could be near.
Many traders and investors try to predict what is next which is a mistake. The charts and price action should be all that we consider, trying to trade the news is a dangerous proposition. Market direction is a cumulative total of events that eventually make markets switch directions.
Looking at the options strategies that were the most popular last week remain bullish, the top three are Call Buying, Put Selling and Put Spread selling. The bears did buy some puts either for protection or as a trade. Bear Calls and Bear Call Spreads round out the top five.
Although tech remains in charge with the top symbols being, AAPL, QQQ, AMZN and ROKU. One big change for the Bulls this week was the SPY moved to the number one most bullish. On the bear side we see no surprises with XLE, CHV on the top. Both are oil related which had its first down week in six. MSFT, WDC and IWM round out the top five.
The biggest concern here could be the price of Lumbar which has collapsed. This could indicate a slowing in the housing markets which has been on fire.
As traders and investors, we have one thing to remember, follow the trend of the market. Be patient disciplined and leave your emotions out. The most important thing to remember is money management and self-control.
Todd “Bubba” Horwitz
BubbaTrading.com