Today’s stock trading was a great example of why you should eliminate one side of the market.
It can be very challenging to trade the same stocks long and short the same day (unless you are getting your primary trend from the 15 minute chart).
Great traders buy strength and sell weakness. When the market rallied today, and the strong stocks caught a bid, you would have eliminated the short in those stocks. This means you were only looking long (in those stocks.)
Sounds obvious but sometimes we can forget or ignore the basics of profitable trading when in the moment.
Stock Trading Recap Video September 24 2015
End of Day S&P 500 Map 9.24.15
The SPY was set up for a downtrend today with the previous close below the recent trading range. The first ninety minutes of the trading day gave us a solid short-sale when the opening bell rang.. Despite the gap lower, we got follow-through. Day traders were treated to a perfect retest of resistance and another solid push lower…then the buyers came back.
I have to admit I didn’t expect a rally but I was prepared with a list of longs. NKE earnings were great after-hours so we can expect the open to be positive.
You can see in the NFLX chart below, price a giant engulfing candlestick daily chart taking the stock price back over $100. There isn’t a long-term bias in the stock right now so it’s mostly a day trade scenario but it is a must for your day trading.
SPY End of Day Chart 9.24.15