Monday, October 17, 2011

Trading the Channel

Since August 10, 2011, the S&P has been in a a trading range between 1120 and 1220.  Last Friday, October 14, 2011, the S&P closed at 1224.58.   Last week, I decided to start trading the channel.  I sold a couple stocks (Boeing and Century Link) that I had purchased, coincidentally, on August 10, 2011.  Then I sold one of my spouse's purchases, Nordstrom.  Today, I sold my remaining shares of Monsanto, which had been a core holding at one time.

Today, the market declined and the S&P 500 lost almost 24 points and closed at 1200.86.  Except for Nordstrom, every stock is already below its selling price.  (On reviewing the charts for all the stocks and the S&P 500 index, I've concluded that maybe I shouldn't have sold Nordstrom.)  At this point, I plan to wait until the S&P is close to 1120 and then buy back all the stocks that I recently sold.  Then wait for 1220, sell and repeat.

If the market should go below 1100, I will consider it a buying opportunity and put 10% of our funds back into the market.

Disclosure:  We have no positions in any of the stocks mentioned in this post.

For more on Strategies and Plans check back every Monday  for a new segment.

This is not financial or investing advice. Please consult a professional advisor.

© 2011 Achievement Catalyst, LLC

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