Sunday, July 31, 2011

Stock Market Video - Technical Outlook - "It's Tricky" - 7/31/11

Hi traders - we have a very "tricky" week ahead of us this week on Wall Street, as the debt mess in Washington continues to hang over seemingly everything and if that wasn't enough, Friday will bring us a big jobs number for July that will likely affect trading.   News-driven environments are difficult to trade for more than a few hours at a time, so I go over my game plan for the week ahead in this video.   I included some setups I will be watching but caution is certainly warranted here because it will likely be a very volatile week.

Here's the link to the earnings spreadsheet for the week - I got this information off of Morningstar's website and I hope it is more accurate than what Finviz gave the past two weeks.  There seemed to be a few dates that were off with Finviz's screener.

I hope you find the video helpful and informative.   As always, feel free to email me with questions or comments - I enjoy hearing from my readers.  If you like the videos, please take a moment to leave a review on Investimonials  

To see the videos in HD, please click "720p" and "Full Screen" on the video bar - HD will be available after processing.

Wednesday, July 27, 2011

Mid-Week Update - Indices Holding Up, But Action is Iffy Underneath

We've had a relatively calm week so far based on just the closing number of the indices, but under the surface there is a lot more going on in this market.   We've pulled back a bit which really is not a big deal in my opinion - we were up most of last week and have held the short-term moving averages nicely.   As long as we don't dip much below where we are at currently, then I still think you lean bullish here.  Now if we break through those short-term moving averages along with the 50 day, I would change my mind and look to short a bit, something I haven't even tried for a while now.  

S&P and Nasdaq
Charts from TC2000, Courtesy of Worden Brothers, Inc.

Just because the charts of the indices look OK doesn't mean all is well, however.   This week (and most of last week) have been very, very difficult to trade unless you have an intraday time frame.   Swing trading (at least for me) has been virtually impossible.  I have had many nice setups come up in my scans the past week or so, but the problem I am having is that as soon as a setup triggers, more often than not it just reverses right back, stopping me out.  This leads to several problems, ranging from the "death by a thousand cuts" effect it can have on your account (I am about 7% off of my highs for the year over the past week and a half) to frustration levels that can affect your outlook if you are not careful.

Whippy Action from Yesterday via WPRT

Now I do run my stops much tighter than others I guess under the premise that I am only right if proven right when trading, and usually when I'm right I am proven right very quickly.  I want a stock to work right away, and when it doesn't, I then take that as a sign that I was incorrect in my analysis and move on.   Maybe my method is just not compatible with this market, but I do take it as a warning sign.   I've seen so many whipsaws intraday where stocks pop, then immediately give it back (likely taking out stops in the process) and then simply rise back up to close where they "should" have in the first place.   That is not really the sign of a healthy market in my opinion.   Maybe it's just me and I'm picking the wrong stocks...

I guess my advice right now is to be careful with what you're doing.   I'm stepping back a bit here, playing a few names relating to earnings but that's really it.   I still see some setups out there that I like (if you want ideas, email me) but I don't really trust them right now.   I think I am going to wait until I see stocks move and act the way I want them to before continuing to take setups immediately when they trigger.  I'm not saying this market is topping or anything but it's not acting as well as I would like so I have to be a little more cautious.

Hopefully this market can get going soon and perhaps break to new highs which would make life easier for all of us, but it is still a very news-heavy environment so just be careful out there.   Good luck Wednesday.

Saturday, July 23, 2011

Stock Market Video - Market Outlook for Last Week of July 2011

Hi traders - here's the weekend video.   It was a hot week outside all along the East coast and it was a pretty hot week on Wall Street as well, as stocks were able to bounce back on Monday and finish higher three of the next four days.

It is still an environment where news is the big driver, but I am still leaning to the long side here and share some setups in this video.   It is also an environment where earnings plays are viable if you find the right ones, so keep your eyes out for stocks that put in good reports (CPHD was a prime example from Friday.)

Here is the link to the spreadsheet for all of this week's reports, sorted by date.   Data compiled using the Finviz screener.

I hope you find the video helpful and informative.   As always, feel free to email me with questions or comments - I enjoy hearing from my readers.  If you like the videos, please take a moment to leave a review on Investimonials  

To see the videos in HD, please click "720p" and "Full Screen" on the video bar - HD will be available after processing.

Thursday, July 21, 2011

Some Charts for Tomorrow and Some Impressions of Worden's Newest Software

I've had some difficulty with my blogging software for the past few days - sorry for any problems.  I shared some charts this morning on and hopefully this is working tonight so I can share some on my regular website. 

I continue to find many good looking setups in my scans this week - the problem I am finding is that not all of those scans get the positive action they should during the actual trading session.   Today we saw a bunch of stocks fade their early gains, names like DTLK, PKT, RRGB, IPSU, and TRGP.   Some momentum names like VHC, NQ, and ONTY also had some nasty reversals today.   This all in the face of a market where the Nasdaq closed up 20 points and the S&P was up percentage-wise almost double that (1.3%).

I am staying long although it has been frustrating this week because so many reversals have occured.  Unless you're trading for a few hours at a time, it is hard right now to hold stocks for swing trades - it just doesn't seem to be the right environment.   I am hopeful that changes as I do continue to see some nice setups and would like to hold some positions for longer than a day or so, but we'll have to see.  As news continues to dominate things, maybe it's just not going to be a swing trading type of environment for a while.

Here are some of those setups I will be watching tomorrow.   Others I think are worth putting on your watchlists are CVV, PSMT, FXEN (all forming little flags) CRIS, and OSUR (potential breakouts).

ABMD - Pocket pivot today
 AVL - Rare earth stocks were hot - look above 50 day MA
 CGA - Low priced, but look at it above Tuesday's high
 DATE - Could be forming handle on this first base - needs to hold
 DEER - Look at it above 50 day MA - Pocket pivot
 IO - Potential inverse head and shoulders here
 LLEN - Pocket pivot, look at it above 50 day MA
 LNKD - Another first base for an IPO - potential cup with handle.
All charts from TC2000, Version 12.

Finally, I wanted to do a quick video to share some impressions of Worden's new version of Telechart (TC2000, Version 12).  I was hesitant to change over to Version 11 because after using it a bit, I didn't see much difference from the old Telechart that I was comfortable with.   However, this new version has many nice features and I will be sticking with it.  The video discusses some of these.   As always, it is free for 14 days if you want to try it out.  They even have a demo mode that does not require you to be a subscriber

Tuesday, July 19, 2011

Earnings Will Dominate Technicals This Week

As a technical trader, I always look at the charts to tell me which direction the market may head in the upcoming days, but right now, in this current environment (specifically this week with over 500 reports coming out), technicals may not matter that much.   We are oversold as you can see below and I do think any good news we get could give this market a quick reflex bounce.   My main signal and breadth signal are actually both negative right now but I think there is still potential on the long side here as long as you keep your stops in place and pick the right stocks. 

Here are a few setups that I will be watching.   I am still seeing quite a few good ones which is a main reason I am leaning bullish here.  I am currently long three positions - all of my trades can be found on my homepage (link to spreadsheet).

Charts from Telechart, Courtesy of Worden Brothers, Inc.

It's certainly not an easy market but if you are nimble, you can catch a good trade here and there.   Let's hope this week provides the spark for stocks to move back up toward the top of this god-awful range of the past five months and provide an easier environment for swing trading.   Right now, all of my trades are VERY short-term in nature.   Good luck today.

Sunday, July 17, 2011

Stock Market Video - Getting Ready for a Busy Week of Earnings - 7/17/11

Hi traders - big week ahead for the market as over 500 companies report earnings this week.  In the video, I discuss the selloff we had last week and where we might go from here.   All in all, things were pretty well contained given the strength of the move we had in the two weeks prior.  We'll see what happens from here, but overall I am leaning bullish as long as we hold some key levels discussed in the video.

In the video, I also discuss the sign bigger cap stocks are giving us here as well as the stocks that I will be watching closely this week. 

I hope you find the video helpful and informative.   As always, feel free to email me with questions or comments - I enjoy hearing from my readers.  If you like the videos, please take a moment to leave a review on Investimonials  

To see the videos in HD, please click "720p" and "Full Screen" on the video bar - HD will be available after processing.

Here's the spreadsheet discussed in the video sorted by earnings date.    Make sure to do research at this time of the year and KNOW WHEN YOUR COMPANY REPORTS!!!

Tuesday, July 12, 2011

Market Thoughts from Vacation...

Greetings from Deep Creek, MD.   Nice place - first time here.   It's been a good week here so far but it would have been better if the market cooperated.  Instead, it has been a pretty tough out there.  Although I haven't been following every little move this market makes, I have traded a bit and just thought I would share some thoughts for the rest of the week. 

Friday was a very bullish session based on the intraday action, but the past two sessions have been about as bearish as you can get.   Here are the facts I am looking at...
  • The Nasdaq picked up distribution days both of the past two sessions, their first since June 17 (I am not counting June 24 due to index rebalancing).   You never like to see back to back distribution days.
  • The breadth signal I use has now dropped below 2, which would indicate at least a "cautious" or "neutral" stance on the market here.   
  • My main signal flashed a "caution" today and could turn to a "sell" with another move lower today.
  • From June 27 until July 6, the market closed at or close to its highs EVERY single day.   The market has now closed at its lows two days in a row.  
  • We are now oversold and in an area where we could bounce.  (below -2000 on my Telechart custom indicator)
What does all of that mean?   Well, certainly things could be changing here quickly.   Perhaps this is just a dip before the two week uptrend we saw from June 27 continues in all of its glory.   Based on the action I am seeing, I have my doubts that this is "just a dip".   I have tried to play a few stocks the past two days and have had hardly any luck.   My stop losses have been hit and I am seeing no follow-through in momentum-type names.   This is a change as well from last week when stocks were flying up and acting super. 

We're also back to a market where news is dominating things, whether it is Europe's debt issues or the start of earnings season.   This will obviously make things volatile, but as I look at the news being traded, I can't quite see what news will help push this market back up.   Exactly what solution is going to be found that cures all of the ills that have infected Europe (and perhaps the U.S. soon)?   All I can say is that the earnings reports coming out better be (in my best Larry David voice here...)  "pretty, pretty good". 

Be cautious here.   I still have a few stocks I am watching on the long side that have held up or look like they want to move higher, but I haven't had much luck with them the past two days so I am much less inclined to play little pops intraday hoping they amount to much more.   It's a little too late to short anything in my opinion, and shorts are actually bouncing all over the place too (look at BEXP and SOHU - two of my favorites, but all over the place.)

My outlook from here is "less is more".   I will trade earnings moves if I find them, but I think the next few weeks is going to be difficult.   It would not shock me to see the market fall right back into the 2600 level the next two weeks, (from which of course it will bounce straight back up into the 2900 level, right?).   It is the summer and volatility is the norm, and August is usually the thinnest month of all in terms of volume, so it's not going to get easier. 

Be careful is all I can say.   We may bounce tomorrow because we're oversold, but until we start closing well again, little bounce attempts don't mean anything.   The burden of proof is back with the bulls from my perspective.   Good luck the rest of the week.   Back to the lake for me. 

Friday, July 8, 2011

Stock Market Video - Hard To Argue About the Strength of This Market - 7/8/11

After a massive run-up going into this morning's job number, the market was certainly set up for a selloff, and when the number came out (which was AWFUL), we certainly got a selloff...sort of.   The market started the day with a gap, tried to bounce a bit, but then quickly sold off further.  That was about it, however, and around 11:15, a bottom was put in for the day and the market rallied strongly from there, finishing well off of its lows.   Although the final numbers will show decent sized losses, in my opinion today was a very impressive showing by the bulls.  Remember as well that this was in the face of an AWFUL jobs number...

I went into the day short two stocks (SOHU and BEXP) and long only one stock.  I was stopped out of both shorts by lunchtime and began to go long again in force as I saw setups I liked all over the place.   This may be the wrong play as perhaps the market needs to pullback further from here, but given the action intraday, I think it was the right move.

Even in the morning selloff, there was no damage seen on any of the charts I went through.  If you went solely by the charts of individual stocks, you would have been shocked that the market was down over a percent.   A slower pullback with more consolidation would have been better, but based on what we saw today, this might be it.   It looks like dip buyers are back in the game and those underinvested during the recent run-up are looking to get invested quickly.

My family and I are lake-bound for our week-long summer vacation, so I am putting a video out now with the stocks that I am watching closely next week.   I skipped the overall market commentary as I think today proved for now that this market is one to buy, but as always, make sure you use stops and don't hold losses in case this market turns.  I will have my laptop during the vacation and although I probably won't be posting much, I will be tweeting occasionally and maybe sharing some thoughts as I get them.   Best of luck in the week ahead - it will be quite hard to top this past week.  So far, I am liking the month of July much, much better than June.

I hope you find the video helpful and informative.   As always, feel free to email me with questions or comments - I enjoy hearing from my readers.  If you like the videos, please take a moment to leave a review on Investimonials  

To see the videos in HD, please click "720p" and "Full Screen" on the video bar - HD will be available after processing.

Wednesday, July 6, 2011

The Beat Goes On...

Following a tremendous week last week, the market has put in another impressive performance this week, albeit in a completely different manner.  I discussed in the weekend video that the perfect scenario this week would be for the market to rest for a few days, giving very little back to the downside but allowing the overbought conditions to work themselves off a bit.   For the most part, that's what we've seen.   I really would have liked for the Nasdaq to come in a bit (it hasn't) but the charts of the S&P and Dow are very bullish.   Another day or two would be beneficial as well because many stocks are very extended here, but so far, so good for the bulls.

That being said, as you can see below we are at the top of a five-month trading range and it is not impossible for the market to roll over here and form a massive head and shoulders pattern.  I am not expecting it, but you always want to be ready.   Given the move we have made the past two weeks, I did start a hedge via QID today and have a watchlist of shorts (DECK, SINA, SOHU, BEXP, and some others) ready to go.   Hopefully I won't have to do anything with that watchlist, but you always want to be prepared. 

S&P 500

I've been long since last Friday with a few names (QTWW, MOBI, YOKU) and added some more names today (FLT, DANG, LAD, MOBI).   I closed my first MOBI position today around $9.76 for a 30% gain as I planned on selling it around the 50 day MA, but given the strength it showed bouncing back in the afternoon, I think there might be one more day of momentum so I went back in for a short-term trade.   All of my trades are listed here - I try to keep them as up to date as possible. 

Here are some names to watch from here.   We're still in a good environment for buying stocks but just don't get complacent.  If you have a position really taking off, there is nothing wrong with taking some profits as it moves.   Be alert to for this market potentially turning soon.  As long as it acts like it has the past few days, then there is nothing to be worried about, but it is the summer, and summer trading can be tricky and volatile, so always be prepared.   Good luck Thursday. 

All Charts from Telechart, Courtesy of Worden Brothers, Inc.

Saturday, July 2, 2011

Stock Market Video - Market Has Biggest Week in A Year, Now What? - 7/2/11

Hi traders - hope everyone is having a great Fourth of July weekend.   We saw quite a move this week on Wall Street, a move which turned all of my signals to "buy".  The key now is figuring out what to do from here.   I discuss some possibilities this week and what levels I will be watching as tells.   Since the market is on a "buy", I also go over the stocks that I will be watching closely this week on the long side as their charts look good.   Just to be prepared, I also discuss a few worrisome things I see about this move and potential shorts IF certain levels are broken.   Hope it helps you out next week.

I hope you find the video helpful and informative.   As always, feel free to email me with questions or comments - I enjoy hearing from my readers.  If you like the videos, please take a moment to leave a review on Investimonials  

To see the videos in HD, please click "720p" and "Full Screen" on the video bar - HD will be available after processing.

Here are fundamentals for the stocks discussed in the video....