Wednesday, September 23, 2009

Excerpt From Pat's Trading Journal - 9.16.09

Today I liquidated my position in Natural Gas. I sold all of my shares in The United
States Natural Gas fund @ $11.69/share. Up $1.98 since I took my position or a gain of
20.39%. My reasons are instinctual. I actually did not look at any charts before I exited.
However, I felt the charts may have clouded my vision and told me ton hold on a bit
longer. Yet, My view on the overall direction of the markets is what drove my decision.

I thoroughly believe in a market correction of 5-10% in equities as well as commodities.
THE USD weakness cannot last forever and is a bit exaggerated. I also track the S&P 500
regularly which is overbought as well. The upper bollinger band (2, 20) has been severely
pierced and the RSI is over 70 indicating a correction is coming. IN addition I did some
research on the call options of the SPX for the next month. It was interesting to see heavy
activity about 6000 calls for 1070, but significantly fewer calls for 1080, 1090, and the big
one 1100. I may be wrong bu the market is ahead of itself.

Hence, I am absolutely sure I will be able to enter into Nat Gas, Crude, and the S&P at
much lower valuations during the next 2 weeks. In the mean time I will explore shorting
some financial stocks. My next play may be to short the XLF. More on that in my next
post. As the Great Warren Buffet says, "You can never loose money taking a profit."

Author: Pat Ambrus


I would like to make a side note that his entry timing was nearly flawless, and his exit was clean. We are currently waiting on a more significant pull back of around 10.5 to assess re-entry points. Overall NGU09 futures have been very volatile which as indeed been reflected in UNG to an extent.


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