The day started out on a tear, the DOW opening up 88+ points and peaked at 11,783. At that point it started to taper downward for the rest of the day. What I don’t understand is why there was a sell off on a day that showed promise.
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Because oil was down the markets had some strength and should have held on to the gains, but for some reason it didn’t and I don’t believe what I see. I’m looking at this at a great buying opportunity. I’ve already took a bite late this afternoon when the financials hit the day’s bottom.
Like I said the sell off shouldn’t have happened today, so when Freddie Mac was down in the low $4 range I bought shares at $4.50 as well as Fannie Mae at $6.40. This is purely a trade play, if things go the way I expect it to be I should catch a little more of a gain tomorrow and sell out of it by the close.
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I’ve said before that I’m not a fan of the financials, but this sector is too volatile and gives great opportunity to play the bounces. Freddie Mac has been in the $4 range several times in the last month and jumps up double digit percentage points within days. As for Fannie Mae, their resistance line seems to be around $6. I don’t recommend this type of trading for everyone and if you’re new to the markets I suggest that you don’t even think of doing it.
Solar stocks seem to have taken a hit today that goes against to what should have happened when oil drops as much as it did, but like I said… It’s a great buying opportunity. Do your research tonight and get ready to jump in. I’ve sat on the sidelines for the last two weeks with my daily trading account, but that’s about to change. I love my job (if you want to call this a job) and can’t wait for tomorrow.
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