Has 9/11 Hurt Or Helped Market?

Volume up thanks to institutional traders.
DOW making a move towards all time high.
Keep a good attitude towards the market.
Keep an eye on that 7 day average. Get the
latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Sunday, September 11th 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 last Friday as well as prepare you for
watching the market tomorrow.

Our friends the institutional traders were back
out again on Friday as the fall season is taking
hold. Volume really ticked up in the last half of
the trading session. Oil and gas prices dropped
again on Friday which could have been the driver
behind the end of week gains.

Today, as I was reviewing the blog content,
thoughts starting filling my head. I looked back
at some of the notes from over the years. Team, go
ahead and plot a Dow chart for the last 5 years.
Let's go back to the middle of January 2000. That
was when the Dow hit its highest ever at 11,750.
From there the next eighteen months the Dow
descended drastically. On September 10th, 2001
the Dow closed at 9,600. The market reopened on
September 17th, 2001 for a half day. On that day
the Dow suffered its largest one day point drop in
history. The Dow closed that day at 8,900. At
the end of that week the Dow was at 8,200.
What's interesting is, by November of 2001 the Dow
had returned to pre-September 11th levels. By
Christmas, the Dow was at 10,100. And, by March
of 2001 at the conclusion of that rally, the Dow
was at 10,600 - that's 1000 points higher than
September 10th, 2001. After that rally, the
market fell hard in a short time to its post 9/11
lows by October of 2002. However, from there the
DOW has quietly rallied to where it is now, 1000
points shy of its all time high set in February of
2000.

I guess my point is, the terrorist attacks were to
disable the U.S. economy and weaken the confidence
in the U.S. To some degree that has worked. No
one lives the same life they lived pre-9/11. But,
the markets show only strength and stamina.

In July, the Dow made a run above 10,700. It
didn't last. The Dow looks to be setup again,
though. The Dow only needs to gain about 100 more
points for it to be positive for the year. The
NASDAQ made a run above 2,200, which didn't last
as well. The NASDAQ looks to be making another
run at it.

Here's my point in all of this ranting team. If
you are investing in the market the way we do,
take a step back. Look at how the market has been
working. And now, think a moment. you have
nothing to complain about, do you. So, when
people are complaining about this or that, do like
I do, and take the high road. Be part of the
market you invest in and show your strength and
stamina. Sure, you're going to need to react
defensively, such as now, I've made over $34,000
in the last three weeks mostly off of buying and
selling options on energy companies. I know most
of you did, too. But, the gas price at the pump
is $3.00 a gallon. I'm walking more and doing
more at home. I'm reacting defensively. But, I'm
not complaining. I'm making money and I'm alive -
and that makes the world a beautiful place.
Misery loves company but it will bring you down
and skew your perception and then your trading
practice will suffer. Don' fall prey.

Okay enough philosophizing.

My EOG resources October 60 calls closed higher at
$11.00 an option. My current return on my
invested capital is 77%. I've been in that trade
for 49 days. My Pacificare Health Systems November
75 calls closed higher at $5.00 an option. My
current return on my invested capital is 72% after
being in the trade for 49 days. My Quicksilver
September 40 Puts closed lower at $0.30 an option.
I'm in the red with a return on my invested
capital of -81% after being in the trade for 23
days. I only have till this Friday to do anything
with those. My Tenaris October 105 Calls closed
lower at $14.90 an option. I'm in the black with
a return on my invested capital of 89% after 14
days in the trade. My Alcon November 120 Calls
closed higher at $7.30 an option. I'm in the
black with a return on my invested capital of 16%
after just being in the trade for a single day.

No telling how the market will come back after
last week's rally. Here is my plan for tomorrow.
stop loss alerts for EOG resources, Pacificare
Health Systems, Tenaris and Alcon at 50%, 50%, 70%
and break even, respectively, for my return on
invested capital. I'll be setting all these stop
loss alerts after amateur hour and they will all
be in the form of pop up alerts as well as email
alerts going to my inbox and cell phone. And,
they will be triggered upon the bid price of the
option going below a level I set. Also, for all
of these positions I'll be watching where stock
price is relative to the 7 day moving average. A
cross under the 7 day is a secondary alert that
cues me to think about exiting.

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.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options 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
resource box at the end intact.