Well, that double bottom turn out to be a major head fake. After the FOMC news, we broke through the 50 day moving average and proceeded to make new lows. I told my self that the low volume bounce into the meeting was a sign of a 'sell-the-news' reaction and that is exactly what we got.
I even put in a contingent sell order right before the news for my long $XIV position. It triggered and I was totally in cash, in my personal account right after the news hit and at my all time high. I should have left things alone. The market actually spiked up and down after the news. After a spike down, I figured it should go right back up. The Fed news was nothing new and my read was they would continue to provide monetary stimulus to the economy.
The Fed news should be good for Stocks, but I guess everyone else was long too, so we proceeded to go down even further. I decided to buy 1000 shares of $SVXY at $84. Big mistake! I didn't have a stop order so it ended the day at $82.89. On Thursday the selling continued and SVXY went to $71.28.
When volatility spikes, this ETF goes down big time. I held out until Friday, hoping for a relief rally. We got a gap up in the morning and SVXY started the day at $75. It proceeded to go down to a low of $71.70. I wanted to sell out, but decided to bite the bullet and use my margin account to double down and try to get back to even. I bought 1000 more shares at $72.05. It was about 5 minutes shy of the day low and SVXY proceeded to climb all the way back over $76. I finally cashed out at $75.42. Not quite back to even, but close enough. Still up for the year and up for the month!
No comments:
Post a Comment