As I continue to patiently wait for the market to work off its oversold conditions I look for opportunities on an intraday basis that I believe provides a good risk-reward opportunity. Often times, it is when the market hits price extremes for the day, and has either topped or bottomed out. But I don’t get in right away, instead, I wait for there to be one or two retests that signify that a bottom is at hand, and then wait for a nice rebound of sorts, to show that buyers are gaining interest once again, and then at that moment, I buy any kind of dip it might give me. The reverse is true for short position that I take on.
Now, I have no intention of holding these types of positions overnight, as I try to sell them at a predefined price target, or at worst, the market close.
Today I bought into SPY. and put a little more than 35% of my capital on the trade. I got in at 108.63 and put in a tight stop-loss of 107.85 – just below the day’s lows. So we’ll see how it pans out – for now though I have a price target of 109.39.