Idan Sticks To His Trades

By
FocalEquity
– May 5, 2009Posted in: Intraday Commentary

Fellow Traders,

Since Idan is not at his desk, I just wanted to notify you, that Idan did in fact, play the channel as he mentioned in his video. He went short around 906$, with a stop, right at the highs. So he will cover his shorts if we push higher to 908$. He says, that we are still in a bullish channel, and that means that any move lower, you should  be taking profits very fast, until the support of the channel is broken. 907 on the S&P is longer term resistance, as it is both an ascending resistance if you take the lows from back of October and the intra-week lows from January. Most important it’s also a 38.2% retracement of the strong move down starting august, so this level is incredibly strong and you should be playing this short and not long, as the upside has been very extended. He did not comment strictly on the stress test, saying that if at all, the stress tests will provide some negative marks, but traders already know a lot of what is expected and therefore this could become a non-event. Idan says financials had an inverse head and shoulders that he pointed out last week on one of his videos, the break of 11.30$ provided a move higher, but there is very strong resistance in the upper 11.70s and 80s. GS breaking out the 136$ mark could be the key to go long financials yet again, but he expects weakness for the time being. Idan continues his conviction that a short here is more favorable than a long, but as long as we stay in the channel we can’t use huge positions to get short. A pull back in options expiration week is also very likely.

Best,

Steve M.

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Sun Tze is one of the founders of FocalEquity.com. After going through multiple transitions, Tze, Charlie Cheng and their new team are bringing new changes and features to the new FocalEquity.com in 2011. Tze is specialized in financial modeling and has a masters degree in Finance.