Absent a systematic and responsible plan, our emotions will run things. When shit hits the fan, we’ll be too scared to get in. When we hear some suited up analyst on television talking positively about the stock we own, we’ll be too hopeful to get out when the trend turns.
Yes, we have to take most of our biases out of our decision making.
But Daniel Kahneman says in Thinking, Fast & Slow, that even he, a Nobel Prize winning behavioral economist, can't take his biases out of his analysis of research and other data. We're all emotional and have to reckon with that when we make decisions about trades and other things.
Historical data and technicals don't predict markets. They just give you a feel for possibilities.
There is no doubt that the SPY daily chart is mostly bullish. But it's also flashing over bought warnings. StockChartsTechnicalRating (SCTR) is a barely bullish 44.5. At 60 or above, we would feel a lot more bullish. RSI is an over bought 70.2.
So far this year, SPY hasn't stayed over bought for more than a couple of weeks or so. Support is at about $393. Resistance is at about $408, I think.
SPY Feb. 17 expiration $408 call options have a 49% probability of being called with the stock over $408. The options have about a 53% probability of closing out of the money, under $408.
I think we're in a bear market rally and that the Fed will hike 1/2 point next week. While I'm bearish, I'm doing bullish puts trades assuming prices will fall and I'll get stocks at discounts. Just sold LMT 2.17.23 $445 strike puts. I recently had LMT put to me at $360 and sold covered calls that will expire today. It's close to be called, if it isn't, I'll sell calls again, which would be a hedge as well as an income trade.
This is the way! ✊🏽👍
Would love to see the systems and rules you follow.
No rule is 100% accurate, but we're all playing odds and find the system with the most reliable signals.
Yes, we have to take most of our biases out of our decision making.
But Daniel Kahneman says in Thinking, Fast & Slow, that even he, a Nobel Prize winning behavioral economist, can't take his biases out of his analysis of research and other data. We're all emotional and have to reckon with that when we make decisions about trades and other things.
Historical data and technicals don't predict markets. They just give you a feel for possibilities.
There is no doubt that the SPY daily chart is mostly bullish. But it's also flashing over bought warnings. StockChartsTechnicalRating (SCTR) is a barely bullish 44.5. At 60 or above, we would feel a lot more bullish. RSI is an over bought 70.2.
So far this year, SPY hasn't stayed over bought for more than a couple of weeks or so. Support is at about $393. Resistance is at about $408, I think.
SPY Feb. 17 expiration $408 call options have a 49% probability of being called with the stock over $408. The options have about a 53% probability of closing out of the money, under $408.
I think we're in a bear market rally and that the Fed will hike 1/2 point next week. While I'm bearish, I'm doing bullish puts trades assuming prices will fall and I'll get stocks at discounts. Just sold LMT 2.17.23 $445 strike puts. I recently had LMT put to me at $360 and sold covered calls that will expire today. It's close to be called, if it isn't, I'll sell calls again, which would be a hedge as well as an income trade.