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 With the action in the markets in the past few weeks I am looking at selling OTM call option premium using bearish credit spreads on $SSO and possibly swing trading long off any deep dips with bounces and shorting reversals off rally peaks in the the 65-70 RSI territory if we get there. We’ll see what happens next.

  1. The last two days have made lower highs and lower lows.

  2. The second break out to new all time highs in $SPY failed.

  3. The MACD is going flat with the short term moving averages converging a sign of a range bound market.

  4. The 50 RSI bounce failed to continue higher.

  5. There is a high probability that this market is converting to a swing traders market from a trending one. Possible buy points are at bounces off the 21 day ema and the 50 day sma if it get there.

  6. Shorting in the hole on breakdowns has not been working in this market only shorting off reversals from highs like taking out the previous days lows.

  7. The best probability trade is selling option premium out of the money over resistance at all time highs or under support at the 50 day.

  8. Many leading stocks reversing and failing to break out of chart patterns. $AAPL $LNKD $GOOG $FB $PCLN.

  9. The historical odds are in favor of a 10% correction this year.

  10. The risk reward is skewed in favor of shorts at these levels.

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