Something unexpected could derail stocks, temporarily, but I think they’d come right back as we’ve seen time and time again. With that said, my aggressive approach to trying to time the ‘overall’ market top backfired. However, there are great short setups in ANY market and that’s where I’ll turn my energy too now. If you follow along with Weekly Windfalls, what you’ll now see me doing is on some of the trades I sell Calls on, I’ll buy buying Puts too here in Smoke Signals. And there’s a specific way I’m going to do that so I’ll get you the video lesson this week so you know what I’m looking at.
For now Five Below Inc (NASDAQ:FIVE), GrubHub Inc (NYSE:GRUB), GSX Techedu Inc (NTSE:GSX), Harley-Davidson Inc (NYSE:HOG) and Mosaic Co (NYSE:MOS) could interest Wall Street. GSX is going supernova so I’m not looking for trouble there but when the top is in, I’ll look for Puts on this one or just short the stock.
All of the others are bearish chart patterns with HOG and FIVE being the weakest and bumping up against the 8 EMA. The idea is to accumulate a Put across several days during the bearish accumulation and sell it for profit into the next leg down.
Shopify Inc (NYSE:SHOP) is my last open short in this newsletter and it went against me Tuesday on an upgrade. I will cut my loss on SHOP and move on from the ‘overall’ market top trades as overbought can stay overbought for long periods of time, especially if the President pushes hard for another round of interest rate cuts.