Summer Markets Produce Big $$$

The low volume, crazy, mixed markets of Summer continue.  By leveraging my June 11th post about the bearish forecast for the Dow I’ve reached a new account high and I’m closing in on 15% YTD.  I’m using a three legged approached that consists of discretionary day trading for days that are lightly trending, automated day trading for strongly trending days (where system trading does well), and then positive time decay / delta neutral trades (iron condors and calendars) that work well when the other two don’t.

Even though in these low volumes days technical setups are less valid we can still make money by trading carefully.  The Dow is looking weaker setting up a descending triangle that can rattle up or down between 8500 and 8300 pretty easily.  Once it breaks that lower support the Dow looks to finish in the 7600 range.

Although this is at conflict with my ‘gut’ instinct that I believe we will be more bullish than this I still want to pay heed.  Whenever my technicals and guts are conflicting I consider this a lower probability environment and will either pass on the trade or size down.  Remember its more important to sit and do nothing than it is to try and force a trade.

I hope everyone had a great fourth!

Mojo

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