shorted at close ~~~ with options your timing has to be perfect ~~~ but you have to buy the correct expiration ~~ not a go all in short as this is still not like the aapl short all in call made on this board at 695. ~~~~ i exclusively trade on charts ~~~ but this one is based on just sentiment on the street ~~~ every #$%$ is long ~~~
I trade options only, also, and i agree. Your entries have to be super tight, but i've also learned that trading and ignoring your intuition, your knowledge of the markets, creates an unbalanced trading plan. You can't trade TA only, not with the Fed in the game.
That said, the easier way to trade tops is to trade volatility, not the market itself. Whenever resistance approaches, vol will move up due to the option volume that pours in based on short and long sentiment, either due to the round number of 1500 or a 13 yr triple top...
Same can be said for for the past Fiscal Cliff BS. You can either guess how the markets are going to react, or how much of the drama they're going to price in, OR you can simply get long Vol and then short it when the FC dram is close to ending.
Stress free, sleep well at night, comparatively.
My concern going forward, being long the Vix, is how the Vix reacts if we break thru and hold this top. Hard to forecast at this point whether volatility rises as we do towards 1570, or if we reach an entirely new comfort level for stocks (scarier still)..
I just couldn't imagine being long anywhere, hoping to catch 1570. Greed at its highest.. i will NEVER be long indexes from here until we get a pullback. Trap or not, i'm not buying it...