52-Week High! Now What?

THE WEEK

Five weeks ago, we hit a 52-week high.  Since then, it has been a bumpy road up and down but mostly down. Volume spikes sent the price souring up and then another spike a week later sent the price down.  The highs are getting lower and the lows are getting lower.  It is like a balloon slowly deflating.

Without a clear extended direction it is difficult to trade.  That’s where my mind is right now.  When this happens, I sit back and think.  I look at current economic data, I listen to podcasts by people whose opinion I respect with the idea of creating a new trading plan to match what I am seeing or not seeing.

Because to keep doing the same thing over and over expecting different results is INSANITY.

LOOKING AHEAD

This week there is one major economic event which I believe could again upset my trades.  The FOMC is releasing their economic projection on Wednesday at 2pm Eastern.  The report includes the Federal Open Market Committee's (FOMC) projection for inflation and economic growth over the next 2 years. An important part of the report is the breakdown of individual FOMC members' interest rate forecasts.  This report is only released every 9 months.  I believe this report will cause another chaotic Market to ensue.

HOW AM I DOING?

It was not a great trading week for me.  I saw the Market going up slightly day-to-day and had placed my trades accordingly.  Then Friday comes along and I lost all the gains I had and a little more.  Implied volatility jumped so getting out of or adjusting bad trades cost me.  I still did better the Market but I am not happy with my results.  

I am grateful for the slap in the face because it caused me to sit back and look at the big economic picture going forward.  I am also grateful to folks in Investing Buddies.  Quite a few have been digging around with me and sent me information on various aspects we are all facing.  I have worked out a plan for moving forward which includes a difference approach to some of my trades. And that’s what we will be discussing on Thursday’s webinar.

This Week’s DEEP DIVE

The Economy and Trading

Shifting Trades to March the Current and Projected Price/Action

Note:  I know this subject is more advanced than our normal DEEP DIVES.