WMT and GDX May 25

These were a couple of call buys anticipating a bounce after some serious drops. First WalMart. WMT hit a 3 year ascending trendline and stuck to it on a day when the rest of the market gaped down, dropped further, and then bounced back. The risk reward on this is good because I will know quickly if the support line holds and can get out quick if the trade moves against me. If it does break support it should be a good stock to short. The recent trend was down on Wal Mart but I am playing the long term 3 year trend line on this one. We'll know tomorrow how this goes.


GDX 1 June 48 call for $2.00

With GDX, Multiple oversold indicators and divergences pointed to a low risk possibility for a bounce in the market. My trading rules don't allow me to trade bounces up in down trending stocks and a few of the gold miners like NEM, ABX, and a couple of others had divergences in the slow stochastic, MACD so of course the gold miner ETF did as well. Playing the ETF also freed me from having to pick between all of the miners that looked like good trades. The stock immediately moved up to almost 49 by the end of the day. As it turned out, the divergence plays on the other stocks in financials and a few other sectors that I wanted to take would have been really good ones too but I stuck to my entry and money management rules. My target on this one is $51.21.