At the end of October 2014, QE3 will come to an end…
It’s already spooking the market, sending us down 267 one day, only to send us back up 200 the next. Volatility is here in a big, big way.
The only way to trade the market at the moment is to be a bit patient… and weave in and out when the market zigs and zags. After watching the market this morning, we are holding all open positions. But we want to add some downside protection, as the Dow – for instance – shows signs of exhaustion at 17,100.
We still strongly believe the Dow could re-test its 200-day moving average at 16,583 before long. And we need to protect if that’s the case.
Consider buying to open the DIA December 2014 170 put up to $4.50.
Again, hold all open positions. After a good win streak, we do hold some losers. We see no reason to close anything at the moment, though.
Ian L. Cooper
Inside Value Trader