Use access key #2 to skip to page content.

inthemoneystock (< 20)

Kill Emotion Then Profit: Stock Markets Rise



July 28, 2011 – Comments (3)

The house will be voting this evening on the John Boehner plan. There are questions on whether or not it will pass. Should it pass, the debt ceiling will be raised within days. Slight optimism is keeping this market higher today. The SPDR S&P 500 ETF (NYSE:SPY) is trading at $131.59, +0.99 (+0.76%). Many investors were ready to jump out of the window yesteday, as fears of a default spread. Always avoid emotion and trade off logic. This was the key to buying longs yesterday and maximizing profits today.

Yesterday, I wrote a blog entry discussing why, how and when a budget and debt ceiling agreement would be reached. Understanding this helped avoid the fear that so many other amateur traders were swept up with. It also allowed me to enter long plays on Bank of America Corporation (NYSE:BAC) at $9.70, Cree, Inc. (NASDAQ:CREE) at $32.15 and ProShares Ultra S&P500 (NYSE:SSO) at $51.85. These were posted and time stamped to Research Center members.  All three plays are rocking it today. CREE is up 10% on the day, hitting a high of the day at $34.44 after the alert to buy at $32.25. Bank of America is trading at $9.80, +0.12 (+1.24%) and the ETF SSO, which is two times long the S&P 500 is trading at $52.32, +0.63 (+1.22%) after the buy alert was triggered at $51.85.

As profits continue to pile up, it is important to recognize why and how? First, avoid the Wall Street hype and focus on reality. Ignore emotion and use logic. By doing that you would clearly understand that the debt ceiling will be raised and the markets will rally.  The next step is to focus on the charts and find the appropriate buy levels. This was done on all three trades yesterday. This helps maximize profit.

Gareth Soloway

3 Comments – Post Your Own

#1) On July 28, 2011 at 1:06 PM, Jbay76 (< 20) wrote:

I'm certain things will not go as planned today and tomorrow the market will take away todays gains and then some.  I'm expecting a lot of show and gimmicks over the weekend that lead to more uncertainty on Monday.  Thus, I expect the market to go even lower on Monday, which is when I plan to execute several trades just in time for the debt ceiling to be raised, and everyone knows for sure that we are all screwed.  Since I am investing in PM miners, that equates to gains :P

Report this comment
#2) On July 28, 2011 at 1:17 PM, XMFCrocoStimpy (97.96) wrote:

I'm not sure why you think that if the Boehner plan passes the House this evening that the debt ceiling will be raised within days.  The Senate has already made it clear that the Boehner plan, as it stands to be voted on, is DOA with them.

If an absolute 11th hour compromise is reached my guess is it will be hashed out in some other form, likely over the weekend, but I see this evening's House vote as just some form of maneuvering, not an actual solution that will be implemented.

Report this comment
#3) On July 28, 2011 at 1:24 PM, davejh23 (< 20) wrote:

"Always avoid emotion and trade off logic."

"It also allowed me to enter long plays on Bank of America...All three plays are rocking it today."

Let us know exactly when you sell.  Your blog on the debt ceiling deal isn't's speculation.  The gain on BAC will be gone by the end of the day.  It's difficult to "trade off logic" when news, even insignificant news, can cause the market to swing wildly in either direction.  The only logical trade I've come up with in the last couple weeks has been to buy dips in inverse vix ETF's...not too hard to make 1%+ a day.


Report this comment

Featured Broker Partners