Hi everyone – this is a rare Monday blog post. Looks like I’ll be trading stocks more actively again, which means more blog posts as well!
I had originally planned on shorting QQQ on market open, but decided against it because of the small gap down. I remembered that it was better to miss out on a trade than to take a poorly timed one that lost money. After reanalyzing the chart, I think 192 and above is a good short entry. My current hard stop loss is 196 – just above all time highs (mental stop at 195), with a target in the low to mid 170s. That’s a risk reward of about 5 to 1, which is really good.
I sold my Facebook shares this morning in my Roth IRA account. I bought it in July of 2018 at around 175, so I netted about 8.5% in a year – pretty good especially since I don’t have to pay capital gains taxes on it. I’ll summarize what I learned from that trade tomorrow.
Let’s look at the daily chart of QQQ.
My plan is to short the stock in that top rectangle with a target near the bottom rectangle. Perhaps this is too greedy, and I should cover my short in the low 180s instead.