Time for a Pullback

A pullback is imminent.

Will it be this month or next? All of the great chartists I know are split down the middle. Half of them say it will happen any day now, and half say it will arrive in February.

While we love it when our stocks go up, a healthy pullback after our run-up in November and December is next on deck. 

Experienced traders take profits by selling stock in January and move into cash to free up collateral for new trades once the market shows its cards in its new direction.

Seasonality says the market will bounce up and down between now and the beginning of March and then enter another bullish pattern for spring around mid-March.

So what do we trade until then?

Good question.

I am not buying new positions for covered calls. I am retrading calls on lots of stock as options expire or rolling in and out to squeeze more profits out of existing positions.

I moved into a lot of cash after the Santa Claus rally. (Some people said there wasn’t one this year- to which I say- HOGWASH- there sure was in the quality stocks we trade in my Millionaire Mentorship Program!) Going into January with cash on hand sets me up for success and flexibility for what is coming next.

While I’m in cash and a market like this, I set up BEAR CALL SPREADS. Now is the time and place for them! 

I have a strategy that allows me not to be naked on these. Reply to this email to let me know if you want in!

Happy Trading!