AREX closing long position at $33.67 5% profit in 19 trading days

Closing out third profitable AREX trade with 5% profit in 19 trading days. I bought this just before it dropped on the bad economic news earlier in the month. So most of March I was sitting on a loss. It turned around in the last few days, and is trading since three days in profit.

The graph below shows all three AREX profitable trades made within the overall uptrend. Notice how RSI (7 period interval,90 upper line,10 lower line) acts as a good indicator of the open and close points. In an long term uptrend like this, RSI of over 90 indicates an almost certain pullback. I used this to time both the first and second sell points, when RSI peaked at 91 and 93. If you are still in a trade with RSI of 93, you're not taking profits off the table quickly enough, and you are likely to see gains evaporate. With $9 commissions to get in an out, why lose money you have already made?

The third trade I didn't know there was going to be a magnitude 9 earthquake in Japan, which sent stocks for a spin. If I had been more on the ball, I would have just taken the quick 1 day profit when it briefly hit $34. I was just happy to get out of the trade today with a profit. RSI was only 79, so it could still run up for 2-5 days more before cooling off. To be honest, I wanted to end the month strong.

Not bad for a month when the S&P essentially made no net gain for the month. I did make losses closing out YONG, ARMH and NVEC positions as the market dived on the Japan news, but other trades closed during the rally (including the short FACE trade against the strong rally in the last two weeks), made up for the losses and allow me to close the month with a profit. As I analyse my performance each month based on the trades closed in the calendar month, I wanted to feel good about the month and have the profit in the bank.