Sunday, February 07, 2010


We would say that 80-85% of the time writing the HCPG newsletter is relatively easy and a pleasure. A few break-out candidates stick out to us on the daily charts, we highlight them, and then review the trades the next day. Right now we're in the other 15-20% of the time where writing this newsletter is a struggle. Why? Because nothing is clear and even the first factor, usually a given: what strategy are you focusing on?-- is tough to answer. We're primarily break-out traders but there are no break-out candidates. Charts are broken.

However if Friday's low indeed is a near-term bottom then we need to find longs. The best we can do is find target longs to resistance. These don't have the same success rate as break-out longs and tend to be more messy/choppy so adjust accordingly. To add to the complexity we have to be aware of the fact that the trend is broken and therefore need to be cognizant of resistance shorts on any rally. Of course "not easy" doesn't equate to "not profitable" as there are many opportunities in the market thanks to the increased volatility. You just have to climb higher up the tree to get the fruits.