From green to red, that’s what was happening to the Wall Street these couple of days. The volatility is simply fantastic. And today’s (Friday) trading session is extraordinary volatile due to options expiration Friday. As usual, I believe most investors are aware of the US economy’s status and how the prospect of recession is still drumming, after all these months (aren’t they tired?). Being a small trader, you simply can’t swim against them if you plan to make money. And with such gloomy days, the best bet is still short the stock or play the Put Option.
Earlier, I mentioned the time couldn’t be better to make money on Baidu.com and if you care to take a look at the stock price of Baidu.com now, you can see this stock is really driving into the pit-stop at $220 before going down to $200 a share level. Baidu.com is condemned, cursed, ailing and whatever you want to call it. But the fact is Baidu.com is sinking faster than Titanic – the stock price plunges more than $100 a share in Jan 2008 alone and with slightly more than a week before the end of the first month of the New Year, you shouldn’t be surprise if the stock could actually lose $200 a share.
Also in the earlier article I mentioned there’s nothing much (or strategy) I could do today except to close some profitable position which is expiring today, unless I wish to spend more time monitoring and filtering stocks for scalping of which I don’t. Google Inc. (Nasdaq: GOOG, stock) and Apple Inc.’s (Nasdaq: AAPL, stock) are two of my positions which I closed to realize the profit. Google Inc. is struggling to stay above $600 but not for long if the bearish sentiment persists. I’ll still leave my other Apple Inc., Priceline.com Incorporated and of course Baidu.com Put Options to run.
So, if you’ve taken the action to short Baidu.com, congratulations. If not, what’s your plan in the current bearish market? Don’t be sulky over a couple of unprofitable long positions but to analyze and do something about how to salvage it. What better day to short the stocks if not now? But please be aware of the technical rebound since the Dow is at lower part of 12,000 mark.
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January 18th, 2008 by financetwitter
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Nice article dude, glad your making money. I really want to get into shorting and I have no experience. How do you arrive at your “PIT STOP” calculations?