I have 6 criteria for buy or sell signal in my trade plan. I want to have 4 of 6 before making an actual move on a trade. Well today we got all 6 in one trading session. Ouch…! But good news CEFL gave us warning signal last week. I got 2 charts I want u to look at,
First the $SPY –
TSI, MACD, near term support, price closed below the 20 day simple moving average, no debt in morning 5 ema will close below the 20 sma. All six in one trading session.
This presents opportunity to buy my fav blue chip stocks on sale starting tomorrow. Look charts of $mcd $pep $csx. They have gone straight up last few months. I’m thinking deploying some my gains into less preforming positions like $dal $ge $f $sbux $t $vz
Now let’s look at CEFL. It gave us little more warning. I got long toward the end of march. By beginning of May I was up $1.15 a share and the RSI, MACD, and the TSI signaled overbought. I sold enough shares to bring home the $1,150 profit. Then the end of last week I get a sell signal on MACD and TSI So I sold 500 shares at $18.05. This afternoon the market got hit pretty good and price moved well under the 20 day simple moving average and broke near support. That is 5 of 6 decision indicators I look at for confirmation. I sold additional 500 shares.
I am now 50% in cash with my 2x leveraged income fund. Now I ride the wave, collect coupon payments on 1000 shares and wait for the next buy signal.