bah! Blogspot is not behaving nicely today, Anyways,
http://maybeitsclarke.blogspot.com/2008/07/aces-high.html
is the link to our earlier post for airlines and we have made some nice profits on this. However, our UNG position is not showing any bullish signs bar for some bullish divergences. What we have been doing is playing damage control by buying airlines. We like UAUA and AMR for this. For e.g. today, we played UAUA as a hedge and sold it off at the close to the falling UNG. Our reasons for not selling UNG is we still believe this is somewhere near the lows. Unfortunately, all the commodities are being treated like trash. We believe USO will find traction around 115 atleast, if not at these levels. Nothing goes up/down in a straight line. If oil needs to fall to $100, it must more likely rise upto $133 or so first.
UAUA is currently facing stiff resistance aroung 9$. There are some downtrend lines too. However, there are also some bearish divergences on UAUA and on SMN(but that is a story for another post). Our strategy will be to buy the UAUA on break of 9$ on strong volume. For now, we are holding onto our UNG. We are taking a chance against our discipline of cutting off losers quickly - we are hoping it doesn't make us pay.
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5 comments:
so you think it is to late to jump into airlines..I am lookimg to get into AMR at 9 but concerned that will move up as soon as buy AMR..(MY LUCK)
haha, not to worry Mimi. My luck of late has not been too good too. This market has been quite difficult to navigate. I would suggest waiting to see how USO does, airlines are like triple short the USO. If the USO starts tanking on volume, the airlines can get another boost. There are bearish divergence on the airlines stocks, suggesting they will needs some weeks of consolidation before moving down further.
For AMR, look at break above 10 on volume. Also remember, I would lock in any profits, as the USO is very oversold at this point. GLTA
sorry I mean't moving up further on the airlines.
your thoughts on how AMR and USO did today? If you get some time can you post some AMR or USO chart?
I hope you bought AMR/UAUA/LCC yesterday and took profits in those. We sure did. USO is very oversold. It could rip higher, but don't know when. The time to short the USO was when oil was at 147.
I think the oil/airline play is becoming very crowded, all sorts of divergences are cropping up. What I mean is it is becoming way too easy to make money, so we can expect some major shakeout soon. SMN is also not looking nice on the daily. I would take some profits off the table, if I were in SMN and let the rest ride.
I am extremely busy these with my new job, so I am unable to update my blog daily. I will try and post a chart of these tonight. GLTA
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