Bullish Cross Live


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1. Short SPY @ $155.52 x 15,000 shares
Cash: $0.00
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2. The Bullish Cross Alpha Model Portfolio
1. Long GLD @ $161.51 x 835 shares
2. Short IWM @ $102.14 x 4,500 shares
3. Short SPY @ $161.50 x 7,500 shares
4. Long AAPL @ $470.00 x 350 shares
5. Long UNG @ $19.54 x 5,000 shares
6. Short GOOG @ $890.60 x 180 shares
7. Short QQQ @ $85.03 x 5,000 shares
Cash: $0.00
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3. The Bullish Cross Trading Portfolio
Cash: $1,333,860.00
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THE LIVE BLOG 9:30 AM - 4:00 PM

9:52 AM -- we left off in yesterday's session with the conclusion that we probably entering a slower period that will require some patience while we wait for to see how the SPY deals with its previous highs and whether that will result in an overbought $NYMO. The $NYMO closed at around +70 yesterday. With Apple, we did get a reversal once the stock filled its gap up near $550 a share. However the pull-back wasn't large enough to constitute a significant reversal day. So we need to see more there.

11:05 AM -- so the Apple pull-back may have already begun. Time will tell. If this is the pull-back, what we're going to do is wait and see if Apple can get down to around a 20-RSI on the 60M, and that's when we'll step in and buy. I think we could see a pull-back down to as low as $520 a share. It just depends on how the pull-back unfolds. The price level is less important than overbought/oversold levels. Given the strength of this rebound, it's unlikely that this is just one legged. So a pull-back to a 20-RSI would open up an amazing opportunity to capitalize near-term.

If we get a pull-back down to $520ish a share, we would likely step into the $520 - $540 April call-spread. That's where we want to be. I think we will see Apple well above that level going into its earnings results. So that's the roll down that we would do from the $580 - $600 spread. If we can get the spread at around $6-$8 then that would be perfect. We just need to wait and see how thing splay out here.

1:15 PM -- this pull-back in Apple today does make a lot of sense within he context of what we discussed in yesterday's session. And that is the fact that (1) Apple was overbought and due for a pull-back; and (2) Apple filled its earnings gap at a key level of resistance. Now we just need to judge how far this pull-back will go. It has already fallen by about 15-points. I'm hoping we see a few more days of selling to push Apple down to a 20ish RSI. If we get that, then we have a clear-cut buying opportunity.

3:50 PM -- with the SPY forming a reversal today, what we should see is a few more sessions of selling pressure. However, since the momentum never got overheated, I do think we will see another test of the highs. In fact, we might be entering a period of consolidation with volatility where the SPY bounces back and forth between $181 and $185. The up momentum was too strong for the rebound to have simply been one legged or to not see some sort of a near-term re-test of the highs.

6 responses to “Bullish Cross Live

  1. Andy, what is the difference between this rebound and the rebound back to the $590 area from late 2012 (after which it tanked)?

    • The rebound we saw in May was all a gap up . That’s not buying. That’s a straight price shift in the bid/ask. Who bought between $555 and $590. I remember that time. It was all a gap on earnings. The situation is just all completely different now. Apple is repeatedly testing the $550 area. It’s bound to breakout. You don’t make numerous re-tests of a level like that without high probability of a breakout.

  2. Andy, I’m confused which isn’t difficult for me, butttt in the past you have talked about AAPL needing to get down below 30RSI and now it is 20RSI. Can you take a moment and explain. THX

    • It’s different time-frames. The 30-RSI on the daily time-frame is rare and is a huge buying opportunity in nearly all cases. A 20-RSI on the 60 minute time-frame is a lot more common and not as clear-cut.

  3. Thx for the clarification :)

  4. Andy, Could you give us an update on the SPY/QQQ situation before going home today?