Trade Update - UYG

Huge market rally today, led by the financials, averaging up 8% as of now (mid-day). Citigroup up 36%, Bank of America up 28%. UYG up 21% so far, so I exited my position, even though I think the rally may continue tomorrow.

Trades:
Sold UYG at 1.85 (bought at 1.53 on Thursday), for a 21% gain in 5 days.

Update

I forgot to mention last post, I bought a little bit of UYG at 1.53 on Thursday. With the markets dropping so far, so fast, I'm just looking for a short-term bounce again.

Recession Confirmed

Market crash again today. Glad I got out of SSO and UYG! Apparently it was the biggest one-day point drop in the TSX since crash of '87. Like that even means anything any more. I think the media can stop giving stats like "the biggest x day point/percentage drop since xyz." Every day it's some new record; the volatility is just crazy. So just stop it with the stats unless it's something really major.

I was wanting to switch over to SKF (2x short financials, basically the opposite of UYG), but was waiting for it to go below $130. It didn't quite make it, and it shot up 30% today -- gah! Missed out again. There's so much opportunity to play these market swings, it's just impossible to time the peaks and valleys.

Oh, and the big news today was that yes, the U.S. is in a recession and it officially started in December of 2007. Well, no duh. I think it's so stupid that it took a whole year to "confirm" the recession. But I guess everyone's definition of the term recession is different anyway. According to the most commonly used rule of thumb, you have to have 2 consecutive quarters of negative GDP growth to be in a recession, which has not happened yet. Obviously that is not a very reliable indicator. I hated how the question in the news throughout 2008 was always "Do you think we're in a recession?" Why wasn't every single economist jumping up and down saying, "Yep, it sure looks like it!" No, no-one would ever admit it. You can never be negative... wouldn't want to spook investors and have the markets drop or something.

Of course Mr. Eric Sprott was right as usual, saying back in January and February of 2008 that it looked like the recession had finally begun. It's always interesting to go back to Sprott's Markets at a Glance articles from late 2007 and early 2008 to see how accurately they predicted the whole mess that is now happening.

I'm obviously more bearish on the markets than bullish, but I keep feeling I'm missing out on the short opportunities and then I end up going long when I think there might be a temporary bottom. And I could see myself trying to grab a short-term bounce again soon, buying back into UYG if it hits the $3.xx range over the next week. We'll see...

Trade Update - UYG, SSO

The markets were up again, so I sold my UYG for a very nice 30% gain in 1 week. While that sounds sweet, I had such a small amount invested in it that it really didn't do much for my portfolio.

SSO finally climbed back up to my purchase price, and I exited my position. At one point on Friday I was down a whopping 40% on this trade, and that scared me enough to get out while I could today without a loss. I can't tell which way the markets are going to go. Is this just the beginning of a much larger rally? I'm too chicken to take any chances, especially after having being down so much, and now with the markets being up 4 days in a row. So I'm happy to get out now even if it continues to rally.

Trades (Nov.26):
Sold UYG @ 6.00 (bought on Nov.19 @ 4.62), a 30% gain.
Sold SSO @ 5.80 (bought on Nov.12 @ 5.65), a 2% gain.

P.S. I should note that with the current crazy commissions I'm paying, you can usually subtract about 5% off the posted trade gains to arrive at what I really made. E.g. I actually took a very small loss on the SSO trade. The variations in the CAD/USD exchange rate over the length of a trade also affects what I really make on these ETFs that trade on the american exchanges.

Bounce

Well the markets finally bounced, with big gains at the end of Friday and today, Monday. You could make a killing in this volatile environment if you could time the bottoms and tops. For example, UYG is up 50% from its lows 2 days ago (Friday), mainly due to bank stocks surging today. Unfortunately, since I bought back on Wednesday, I was already down about 28% by the time it hit the lows on Friday, so the huge +52% gain from there only brings me to about +10% as of today. So I need the rally to continue in order to actually make any reasonable amount of gains on it.

Trade Update - UYG, DXO

The market has continued to drop, and so has oil. I made a bit of a gamble trade today, buying UYG (2x financials) at 4.62 at the end of the day, after it had dropped 20% today alone, and is down 50% from 2 weeks ago. It feels wrong to me buying long ETFs when the market is crashing, and I may regret this (I feel like I'm starting to rationalize like I was in the dot-com bust). It could easily plummet a lot more this week as the DOW breaks the 8000 mark, but again, I'm still just looking for a short-term bounce to make a quick 20% after such a large drop.

I also bought some more DXO (2x oil) at 3.68 today while oil was down around $53, to add to what I bought at 4.85 when oil was $59. I don't know why I can't be more disciplined and wait for oil to drop to $50 so I don't spend all my cash too early... I got too impatient and gave in. This trade doesn't worry me at all though. Who cares if oil goes to $40 short-term. In a few months it will be back up. I won't lose money on this trade; I just may not make as much as I could have if I waited to buy in lower. I plan to make a minimum of 100% on this within a year.

I'm still holding my SSO even though it's down 15% now.

Trades:
-bought more DXO @ 3.68
-bought UYG @ 4.62