Cycle Trading

[Duma]

Good list of options, the same ones going through my head. But I got to tell you that I am becoming more convinced each day as to the power of my cycle trading and I am becoming bolder.

For the few symbols that I trade, I now watch a 10, 60 and daily charts. I have already seen that when they all line up, it is very powerful.

Currently SQ 10min is in MU, very strong
SQ 60 min is in AC which can reverse and go back into MD, but normally doesn't and just moves up into MU.
SQ daily is in early stages of DS and as I discussed with you last week, now longer really bothers me. If it turns back into MU, I got a trifecta of trading.

With all that said, as you rightly suggested, I am going with C. I will follow my charts and play the cycle. That is what I am all about, cycle trading.

Now let's talk about naked trading. You trade naked all the time, but you are so conditioned to doing it you don't even realize you are doing it. When you buy xx shares of a stock, are you not naked? They can easily flash crash to something much closer to zero. So often we set stops to control our nakedness. Akin to doing an option spread.

So yday I entered the market based on my 10min TQQQ chart. And after I got stopped out and then got my head on straight, I rebought and played the whole day without a stop. I was convinced my chart would tell me when I should be concerned, which did come late in the day. The little wiggles of price are only there to take the timid out of a good trade. Trade the chart and wait for a clear signal of some kind.

So if my charts tell me there is weakness in my stock and the indicators start pointing down, what is wrong with being naked short. I have done this many times before and when I am forced to be away from my computer, I do usually create a "stop" by putting in a buy stop for the equivalent shares at some level that I am comfortable with.

So my plan would be to sell the stock if I get some kind of a sell signal, be it 10min or 60min, and then rebuy it if I were to then get a buy signal from either of the charts. I am very comfortable with this. Just as comfortable as I am sitting here with 100 shares of SQ, long and naked.