GE – UTX Spread — Playing Ranges

Here is a great example of best laid plans.

Going into earnings season I have to remain light so that I’m able to allocate capital when quality opportunities arise.  I want to avoid getting snowed into positions now, even if I feel they have a decent long term edge.  The red arrows are where I shorted, the blue vertical line is where my algo changed and alerted me to get out of the trade.  The first green arrow was my best laid plan, the second green arrow is what actually happened.

This trade will setup again for me, sure as I’m sitting here.  Maybe from a lower level, maybe from a higher level.  Being flat now means that when it does, I will be able to enter with a fresh perspective and from a position of strength.

This is what making sausage is all about.


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