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Manage the Profits On Your Calls - Keep Raising Stops

Posted by Pete Stolcers on October 4

Posted 9:30 AM ET – The path of least resistance is higher. Traders are complacent and risk as measured by the VIX is at a historic low. This condition can last for many months. Don’t expect any explosive moves, just a gradual grind higher.

This morning ADP reported that 135,000 new jobs were created in the private sector during the month of September. That is below the 160,000 that were expected and this was a “soft” number. ISM services will be posted 30 minutes after the open and a number higher than 56 would be consistent with strong growth. The economic numbers this week (China’s PMI and ISM manufacturing) have been good.

Earnings season is approaching and the bid will be strong. Any market decline will be short-lived.

Tech stocks look particularly attractive ahead of earnings.

Swing traders should remain long calls if the SPY closes above $251. I am raising this stop.

Day traders need to tread cautiously here. Most stock moves are happening overnight and after the first hour of trading the action slows to a crawl. Most of my profits are coming from bullish overnight positions. I like down opens for day trading and I will be a little more aggressive today.

Stay long.
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