I agree with OT's take. Nitro you've made a true statement above. However the time to have sold PG would have been in conjuction with the strength in Tech this year. Something like a short PG with a long in ES or for an even higher beta spread, long NQ short PG. On the break (if there is one) I would expect PG to get hit less than the leaders of this rally. Maybe flip your thinking a bit. Find a stock that's over ripe as a short and look for something resembling a "value" long against it.
The next long term trade
- Thread starter nitro
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I agree with OT's take. Nitro you've made a true statement above. However the time to have sold PG would have been in conjuction with the strength in Tech this year. Something like a short PG with a long in ES or for an even higher beta spread, long NQ short PG. On the break (if there is one) I would expect PG to get hit less than the leaders of this rally. Maybe flip your thinking a bit. Find a stock that's over ripe as a short and look for something resembling a "value" long against it.
On the daily PG in the past few days is becoming more bullish in my view while the dow is looking toppy. PG has been weak on the daily since early July and is *now* challenging resistance on volume! I would say the YM will be the better short and PG would in theory be the better hedge! However neither instrument is setup for an immediate short given my style (stupid tape reader / trend rider). I also prefer to keep my position size such that I require no hedge, but I realize this is not for everyone.
Just my 1/50th,
-TD80
Just my 1/50th,
-TD80
Yes, and what is funny is that I am not sure of the trade. Both yours and OT arguments are powerful, but it is not necessarily born out by the charts.
When I stated in my original post that I was unsure if PG was the best choice because of it's use in defensive situations, I meant it!
It has occured to me to pair PG with ES and NQ. However, both of those would be far more directional trades. Take a look at PG vs NASDAQ chart at the bottom of this page - correlation ? ZERO.
The NDX could be a play on the interest rate picture setting up though...
nitro
When I stated in my original post that I was unsure if PG was the best choice because of it's use in defensive situations, I meant it!
It has occured to me to pair PG with ES and NQ. However, both of those would be far more directional trades. Take a look at PG vs NASDAQ chart at the bottom of this page - correlation ? ZERO.
The NDX could be a play on the interest rate picture setting up though...
nitro
FWIW - a weekly view of PG from a service I follow.
http://stockcharts.homestead.com/PG_2003.html
Disclosure: I have been long PG in my IRA since Aug (86.75).
http://stockcharts.homestead.com/PG_2003.html
Disclosure: I have been long PG in my IRA since Aug (86.75).
Quote from nitro:
Why would you ever draw the trendline on top that way?
Seems to me the "correct" trendline is thru the few bars between late March/early June?
nitro
I didn't post to debate the drawing of trendlines - but from my experience there is no right or wrong way. The t/l was drawn from the highs of 2002 and has three touches going into April, so I think it qualifies as valid.
