Today we saw the rebound we anticipated after yesterday’s Fed rate hike. We can expect this trend to continue for the market in general for a few more days as more sensible traders prevail in the aftermath of yesterday’s crash.Some of our rebound was dulled by dividend payouts by COTY, GRPN, and GPP that caused a temporary drop in these issues. We expect all of those losses to be gone by the end of the week.
Today our position in NGS that we took yesterday during the crash closed automatically at our target of 34.00 – 2 points higher than entry price. Our strategy this time was to enter an actual sell order at the target price instead of creating a profit exit order – this dramatically decreased execution time and allowed us to sell during a very short-lived spike over 34.00 – a profit exit order would never have been able to execute in that window.
The only drawback to entering exits directly is that it prohibits you from using a profit exit and a loss exit – if you have already queued your shares to sell you cannot also have a stop-loss exit. This means that for positions set up with a hard sell the trader has to be actively watching the price in order to react quickly in the event that a stop-loss exit is needed.