[10.1] time to hold cash and wait for signals again

Someone asked whether we can still buy call options and I said quite difficult. It is easier to buy put these days. As long as the stock is down trending, we can enter.
(go to the lessons in August of this blog and find out more information)

Here are some potential puts:
GE
GILD
GLW
MDT
SU
These stocks did not perform strength when most stocks rebound last night with bullish engulfing patterns or forming hammer candlestick.

The key criteria we should look for will be:
1. The bar yesterday cannot close above at least half of yesterday's bar.
2. volume may be high last night but still not enough to push a higher close, that means still weak.
3. The chart is still below the cloud (if you use Ichimoku) or still downtrending and below key moving averages or out of the last Darvas Box.

However, I think we should hold on this week as we have to see the outcome of S&P500. It is rebounding and we cannot enter put this week. TRINs are showing bullishness and VIX is lower.

For call, I can only watch these 2:
MCD
D (Dominion)
These 2 are relatively strong, still making higher high last month when all others are struggling to reach the last high.

Finally, we should watch VIX closely. VIX = CBOE VOLATILITY.
(go to the links above and find out more information)

VIX above 40 means bearish and if VIX can drop below and continue below, we may consider cutting puts and watch calls. VIX at around 25 will be good to buy calls. So, at the moment, we concentrate on puts.


Disclaimer: This article is for education only and not a proposal, invitation or advice to buy or sell shares or options. 

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