Shorting Strategy Going Forward
I've been pretty light in the trading portfolio these past couple of days. I still have a long position in gold (GLD), and I am day trading the SPDRs S&P (SPY) with descent success. My biggest problem scalping is that I try to get a little too 'frisky' with my trades and end up getting in and out waaaaaaay too much. As a result I have to set limits to how many daily round trips I can make in a given day. When it comes to scalping the S&P I usually like to wait until around lunch time before jumping into the trade, that way, I have some candles to trade off of (I use the S&P 5min) and general direction of the markets have been defined somewhat.
The reason for waiting so long is that the earlier I trade, the more likely I tend to get on the wrong side of the trade. Come around 3pm in the trading day, if the position that I am in seems to be stalling and not going anywhere, much like the S&P did today at that time, I get a little skittish and try to lighten up some on the position or close it out all together.
Anyways, I've posted a fibonacci retracement from the high to the low on the S&P using 1 hour candles. I'm looking at getting pretty aggressive with my short positions come 1130ish. A sell-off from that level would complete the head & shoulders pattern that has been forming since last December.
Here's the Market Analysis on the S&P...