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New Housing Sales Increase!

Experiencing heavy traffic on the DOW. Oil
prices rise today as stockpiles diminish.
Watch for something to break stalemate

soon. Oil prices boost portfolios. Get the
latest at TradingTrainer.com.

This is A.J. on Wednesday, August 24th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching
the market tomorrow.

Today, we had a full-on distribution day. Price
dropped, especially on the Dow. We had heavier
volume on all the major indexes with it
approaching the level of the 100 day average.
Today the commerce department reported that new
housing sales increased. But read the fine
print; the prices are dropping and inventories
are up to a 4-month level. Also, durable goods
orders declined more than expected. And finally,
the capper to it all was oil and all of its
derivatives hitting record closes today after the
energy department reported stock piles dropped
unexpectedly. For the NASDAQ this is the 4th
distribution day in just 20 trading days.
Everyone wants to know if this is the end of the
rally. We can tell with all the consolidation
patterns forming across all sectors that people
are waiting. They’re waiting for a spark of a
hint to break the stalemate in one direction or
another. Tomorrow, we’ll be looking for follow
through on today’s actions.

Today, with the oil sector running hot, my
portfolio gained somewhat. My Encana October
42.50 calls closed higher at 3.50 an option
putting me in the black by 21% having been in the
trade only 33 days. My EOG resources October 60
calls closed higher at $4.50 an option still
leaving me in the red, down 27% having been in
the trade only 33 days. My Pacificare Health
Systems November 75 calls closed flat at $3.40 an
option keeping me in the black by 17% having been
in the trade only 33 days. My Premcor September
75 calls closed higher at $6.00 an option putting
me in the black by 15% having been in the trade
only 20 days. And finally, my Quicksilver
September 40 Puts closed flat at $1.70 an option
keeping me in the black by 6% having been in the
trade only 7 days.

This is my plan for tomorrow. After amateur
hour, I’m setting limit sell orders on stocks in
my portfolio, good for the day, setup to catch
profit. I’m still running my strategy around
Pacificare Health Systems by placing a limit buy
order for Calls to trigger should price break
above the Bollinger Band and a limit buy order
for Puts to trigger should price break below the
Bollinger Band. Those limit buy orders are only
good for the day. For that matter, I am
employing that same strategy on Cerner Corp and
Genentech. Other than trying to catch breakouts
after consolidation patterns, I’m staying put on
the sidelines during this volatile time.

Okay, team. I’m done.

Till tomorrow, happy market watching, trading and
money making. Trading Trainer is here helping you
create your dream lifestyle.

Best regards always
A.J.

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stocks
charts on video each week, listen to his audio
newsletter where he leads you by the hand through
the end-to-end process of successful option
traders and get tips and tested strategies proven
to boost your return on your invested capital by
massive amounts in his membership site at
TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
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TradingTrainer.com Web Log

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