Within my time-frame (1-20 days) the $RUT trading below its 10,20,50,200 day moving average is a big deal. When this is the case I tend to press on the brakes and prefer mean reversion trades versus breakouts. Breakouts tend to work below average under these circumstances. The mean reversion trades should be in liquid known names, not your local small cap. I’m talking about the big names from the DOW JONES, QQQ, SP500, the $TSLA‘S $AAPL, $LNKD $GOOGL, $Z, $AMZN ETC…..Keep an eye on oversold/overbought indicators like the McClellan Oscillator, and % of stocks above their 10 day and 20 day ma’s, when they get to extended to the downside you tend to get bounces until that one time that you don’t, keep that in mind.
Frank Zorrilla is the founder of Zor Capital LLC a New York based investment management firm. Our goal is superior performance, with preservation of capital as our number one priority. Zor Capital manages separate accounts (both taxable and retirement) for accredited investors and institutions. This structure gives clients access to a hedge fund like strategy while maintaining 100% control of their accounts. Managed Assets
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