April 5 Update

Hello all,

I’ve been keeping an eye on the market and it seems as though we are at or very close to a breaking point on a descending triangle.  This is true both of the DOW and the S&P.  Will we bounce or will we push lower?  There’s no answer to that until it actually happens.  Once it does happen, the direction of the market will become more clear and trades with low risk and high reward can be taken.

On a side note, with the addition of $AAPL to the DOW, I believe the S&P is a better indicator of overall market health.  So any time I reference “the market”, I am talking about the S&P unless otherwise specified.

A number of stocks are at key support levels, some are in bollinger band squeezes, and others are in existing down-trends.  Let’s take a look at a couple of stocks exhibiting this behavior:

$JNJ:

As can be seen, $JNJ has been in a down trend in recent months.  It appeared to have formed a double bottom, but it is about to retest that bottom.  $JNJ was in a downward channel, but made a higher high and slightly broke out of the channel which is slightly concerning.  However, if it breaks and closes below $98, I’m looking for a swing trade over the course of a week or two down to $95.  MACD is already looking slightly bearish and a close below $98 should support a short trade.  The other way to play this stock is to go long if it bounces off $98, but that would be a counter trend trade and would require a tight stop.  JNJ$LVS is another stock in a downward trend worth looking at.

$FSLR:

This stock does not necessarily follow the trend of the overall market.  As a matter of fact, it has been in a side-ways pattern for around a month or so and is now in a bollinger-band squeeze.  Whichever way it breaks out of the band is the direction I would take the trade.  However, I would start with a small position due to the possibility of a “head fake”.FSLR$HES is a stock just about to enter into a bollinger band squeeze.

$EXPE

$EXPE is a great example of a stock breaking out.  The only thing I am concerned with is if the market pushes lower, the breakout could fizzle.  A low risk trade would be watching for $EXPE to come back to $96.74 before getting in and keeping a tight stop.  You may miss the move with this approach, so the alternative is to get in at market open understanding that you’ll want a wide stop.EXPE

$EBAY:

$EBAY is and has been in a nice uptrend.  It sits on the ascending trend line and is a good low risk/reward play.  However, this one may also depend on the direction of the market.  MACD is looking bearish so the stock may roll over.  If it does $55.50 is the first target.  $54.00 is the second.  If we get a bounce, $59.70 looks likely as a first target.EBAY$BBY is another stock in a similar up-trend.

That wraps up this update.  Have a great night, hope you had a happy Easter.  Good night and happy trading!

23 March Update

So the $DOW had a nasty sell-off at the end of the day, but still remains in an uptrend.  Meanwhile, the S&P, which also sold off, is starting to flatten out a bit.  Overall, I’m cautiously bullish.  If the trend of the last few trading sessions plays out, we can expect a white candle tomorrow.

Real Account Update:

Reviewing yesterday’s trades, $DD was up slightly. I was able to get into the trade around the lows of the day.  I bought the stock outright, rather than buying calls.  $DD held the ascending trend line and still looks healthy.

$EXPE sold off with the rest of the market.  I was hesitant to get into the trade, due to the volatile open.  $EXPE sits on solid resistance, so this is an even better bullish entry with less risk and more reward.  I’m not sure I will take the trade, but I’m very interested to see how the stock moves tomorrow.

What I’m looking at:

$JNJ

$JNJ has been in a down trend since the end of last year.  However, a double bottom may be in (see chart below).  If we close above the “neck line”, I like $JNJ long; first target ~$106.50.JNJ

$PFE

PFizer just closed at its all-time high today.  You can see that MACD is about to turn positive and volume was strong on today’s breakout.  The long wick is a little concerning, but this entry provides low risk/high reward.  First target is $36.03.PFE

$VLO

Lastly, Valero is on the cusp of a breakout to all time highs with MACD just starting to turn bullish.  If this one breaks out, I like a medium term target (approximately 1 month) of $68.45.VLO

  On My Radar:

$COH, $MA, $SBUX, $TIF, $WFC, $AAPL

Just a quick note on $AAPL; although it gapped up slightly, the candle was still one of indecision.  I’m still looking for the $129.50 entry.

That’s all for tonight.  Happy trading!

Market Recap for July 15, 2013

Hi all.  I just want to apologize for missing the last couple of days.  The summer is proving difficult to keep up with work, leisure, family/friends, and stocks.  As a result, the blog is slipping off the plate.  Therefore, I make no promises on how often I update, but I would like to be able to update at least 3 times per week during the summer.  That is my short term goal with my long term goal of updating daily once the summer winds down in a few months.

So.  Today we had another all-time high close but the end of the day saw a slight sell-off.  I think we are due for another turn down, draw down, whatever you want to call, but I think the bears are sniffing around.  That being said, I would not enter short unless tomorrow really does sell-off.

REAL LIFE ACCOUNT:

$DIS:  HOLDING (-15%)  I entered this at the wrong time.  I think my strategy is going to focus more on formations rather than intermediate support and resistance lines.  I want to focus on strong pivot points, trend lines and patterns ready to break out.  That is my new focus when looking at trades.

$HES:  HOLDING (-2%)  See comments on DIS.  I should have gotten in early, but I was worried about an intermediate resistance that probably was something more to be aware of than to place a trade around.  

$DMND:  HOLDING (+11%)  Finally, a good trade!  I am moving my stop up but DMND looks strong to me.  It’s due for a down day or two, but I think overall we are heading to 24.00

$WLT:  HOLDING (+55%)  This is good, but not as good as it looks.  I wrote a $12 put that expires this Friday.  I’d be happy to own this stock and write calls against it if it channels or declines.  Similarly if it rises, I’m happy to write puts as it goes up.

Picks for tomorrow coming soon.

Trader Remorse and Market Recap for Tuesday, July 9

The bulls are here to stay!!  Or are they?  Taking a look at the S&P ($SPX) (posted below), I’m seeing that today we were one penny shy of the high from 6/18.  What happened after that?  Two rather colossal down days.  I’m not predicting that happens, but I wouldn’t be surprised if we had a little down day that tests the bottom trend line and perhaps even the 50 SMA.  One big difference between now and then is that MACD had not crossed whereas now it has crossed and looks strong.  Looking at the $SPY, we broke above that bottom trend line, but I would like to see some stronger volume coming into play.  Lastly, looking at the $DOW, we have not cracked the overhead resistance line that started forming with the wick on 5/21.  I would like to see a break above this line.  Overall, I am bullish on this market…. for now.SPX_JULY_9_2013

REAL ACCOUNT ACTIVITY:

I had no picks from yesterday, so I’m moving straight into the real account activity.  I have to be honest, I am getting incredibly discouraged.  A few more abysmal days and I may begin paper trading until I see some more consistent results.  My account is down 50% from when I first start in early 2012.  Granted I didn’t know what I was doing that, but even with the knowledge and technical experience I have gained, I am still down about 20% since March.  Part of this is due to bad technical analysis (see the $LULU and $POT trades).  Others due to stupid mistakes (see $VZ) trade, but overall I feel like I am psyching myself out because of the losses I have incurred.  I am not taking profits when I should because I am trying to let the stocks run and I am incurring losses that are too large on the losing side.  All this compounds into big down days.  Now, I am playing with options which may also be part of the cause, but I just do not have the money to be buying 100 shares of various stocks and then trying to write covered calls etc.  Again, I think I may move over to paper trading for a little while until I start becoming more successful.  The last thing I want to do is blow up my account.    Anyway, here is the review:

$AAPL:  CLOSED (-11%).  I was up 15% at one point early this morning, but due to being at work I was unable to move my stop down and maintain my profit.  I also had the through of “letting the trade breath” but my stop was hit and the rest was history.  Very disappointed I wasn’t able to take profits when I wanted.

$AAPL:  OPEN/CLOSED (+2%).  I entered in long once AAPL was above $3 on the day.  I made a measly gain that I closed out at around $419.  I was spooked by the earlier trade, but had I waited I would have just about pared my loss.

$LNKD: HOLDING (-2%).  From up 11% to down 2%.  I’m not exactly expecting a rebound tomorrow.  Looking at the past 6 months, a down day is almost always followed by another down day.  I will probably get stopped out.

$AXP:  HOLDING (+24%).  This trade looks good percentage-wise (and it is).  But compared to the AAPL and LULU loss, it is a small gain.  I am moving my stop up to lock-in gains.

$UA:  HOLDING (+3%).  I’m not overly confident with this trade any more.  I’ve moved my stop up to avoid any significant loss.

I truly feel like I am very close to doing well in this thing called trading, but I need to figure out better risk management especially when trading options.  I certainly do not want to give up, but paper trading may be the only way to salvage my account while I find my groove.

Market Recap July 3, 2013

Happy Independence Day, Everyone!!

As we know, today was a half day of trading.  Taking that into account, it looks like volume was on par with yesterday’s action in the overall market.  However, we once again failed the 50 MA.  I’m not sure if or when we will break it, but I truly wish the market would pick a direction and get back into a trend.  Although it’s been true for over a week, it’s very obvious that we are range bound by the 50 and 100 SMAs.  Notice that Stochs are turning up as is MACD.  This could be an early signal that the bulls are ready to take control.  But as always, only time will tell.  I have re-assessed my analysis with a more defined bracket trade.  Currently, we look to be in a downward expanding triangle.  A break out of this trend (and subsequently a break above the 50 SMA) should send us higher.  A break below the 100 should keep this short term bearish trend in tact.  SPY_JULY_3_2013

REVIEW OF YESTERDAY’S PICKS:

$TLT:  You would have gotten triggered in bearish on the 15min rule finishing the day up $0.17.

$COST:  No Trigger

$UA:  No trigger, but it looks like Friday could be a good entry.

$GOOG: No trigger, but keep an eye on this one.  That bottom trend line looks strong.

REAL ACCOUNT ACTIVITY:

$POT:  HOLDING (-22%)  I see now that I probably went short right at support.  It’s all in the perspective of how you draw your trend lines.  I should have used the wick from the candle on 11/26.  Although percentage wise I’m down considerably, I am not down much monetarily.  My stop is remaining in place.  If I get stopped out on Friday, then so be it.

That wraps things up for tonight.  I hope to have some picks up tomorrow.  Again, wishing everyone a safe, fun, happy 4th!

Another Day Another Doji; Market Review for July 2, 2013

Another day, another doji and another failed attempt at cracking the 50 SMA.  I’m not entirely sure what this means other than the fact that doji’s represent market uncertainty.  Could we be forming some sort of bearish flag?  I think it’s definitely possible as volume continues to decrease, but curiously, the oscillators are ticking upward.  MACD has almost crossed while Stochs have already crossed.  It’s very interesting where we may end up from here.  One thing to keep in mind tomorrow is that we only have a half day of trading.  Markets close at 1:00PM EST and then resume on Friday.  I can’t see us breaking the 50 on a half day.  I think we will just meander tomorrow and leave the move for Friday or maybe more probable; Monday.  Personally, I am still looking at a bearish break out, but time will tell.  SPY_JULY_2_2013

REVIEW OF YESTERDAY’S PICKS

$BBY:  This stock sunk like a rock today.  Fortunately, you never would have been triggered in bullishly.  Today looks like a tweezer top.  I’m not sure what this thing is going to do.  I’ll leave it be for now.

$WYNN:  WYNN you would have gotten triggered in at the end of the day.  I did not get in due to being so close to my first target of 125.  A close below it and I would go short down to 121.

$GS:  You would not have gotten triggered in at the end of the day.

$GPS:  You would have gotten in and then stopped out.

REAL ACCOUNT ACTIVITY:

$POT:  HOLDING (-7%)  I am sticking with my stop of 38.30.  

$GPS:  OPENED/CLOSED (-15%)  I only bought 1 contract so this loss was really pennies to my account.  I’m not sure if my stop was too tight, but we’ll see within a few days if it was in a good position or if I should have kept it lower.

 

Market Overview for June 30, 2013

So Friday marked a second day in a row of failing to close above the 50 SMA.  In fact, we did not even get to the the highs of Thursday.  This is not a good case for the bulls.  On the bearish side, we are now within sight of the 100 SMA.  A breach of the 100 and I believe we will be out of “no man’s land” and on a confirmed, but short term, bearish trend.  I like targets of 155.75, 153.58 and the 200 SMA.  Of course, this breach should be on solid volume.  As for the bullish side of things, I would not get in bullish on the overall market until we close above 166.05.SPY_JULY_1_2013

REVIEW OF YESTERDAY’S PICKS:

You would not have gotten triggered into any of those trades.  However, it’s worth pointing out on a day where the market took a nose dive, UA finished up strong with solid volume.

REAL ACCOUNT ACTIVITY:

None