Thursday, May 31, 2012

Thursday Evening

Fat cat banker
Well maybe it's Anderson Cooper .... one thing is for sure .....  May sucked!!!

Thursday Afternoon

CRUS Daily chart (11:00AM)
CRUS is pulling back to test the breakout.  If it bounces I will likely add to my starter position of June29 calls.  If not I will dump the starter if the falls back into congestion around 26.50.  The pullback has been on lighter volume and that's a good thing.

Thursday Morning

Gator's Chart of the Day: DGIT
I know nothing about the company but I hear it is rumored to be a takeover target.  It was mentioned by Karen Finerman on Tuesday's Fast Money episode and it traded up after hours that evening.  Wednesday it saw tremendous volume and a 9%+ move up on an ugly tape so there is interest.

If you want to take a shot it's testing it's recent high of 10.13 and a move above there could trigger even more demand.  If I owned it I would watch volume very carefully and if buying pressure drys up I would dump it on any move below the 50 day simple moving average.  That is 9.38.

Wednesday, May 30, 2012

Wednesday Evening

Wednesday Afternoon

AGNC Daily Chart (11:30AM)
This one pays an excellent dividend (15%+) and has a very nice uptrend.  You can see the periodic gaps down.  Those are the payouts made by this REIT.  The next payout should be very soon but I did not look it up.  (Do I have to do everything?)

If you wait for the drop and then buy it sure looks like that has been a winning trade.  If you want the dividend stream you can just hold on.  Be aware there was an article last week that suggested the payouts may be interrupted but I don't believe it.  With housing firming up I think this one will do well.

Wednesday Morning

Gator's Chart of the Day: CRUS
I didn't see any posts on yesterday's blogs that mentioned CRUS ... either we all missed it or somebody is keeping secrets.  I guess we can call this one a Lurker's Special.

Cirrus Logic spent all of may in a fairly tight range as it consolidated a big two day move.  Once the stock and the 50 day simple moving average found each other the price firmed and began working higher.  Tuesday it popped above the upper Bollinger band making a 7% move on volume that was 70% higher than the 50 day average.

Although the stock is clearly extended above the 200 day (green line in the bottom corner of the price section) the forward P/E is only 13x.  They have no debt and a price target near 34.  I think it's too late to buy aggressively but a trading plan that includes one buy at a lower level could be initiated here.  The add would be on a bounce from a retest of the breakout.  The stop on the initial buy would be back in consolidation and would be nearly 10% below Tuesday's close so it's necessary that a buy here be small.

Tuesday, May 29, 2012

Tuesday Evening

The action today was an example of why this market has become very challenging to trade (in my opinion). A lot of the typical things traders look at were lined up just right for more downside. We reversed from the highs by slightly more than 10 points, the Euro was weak, Gold was weak, there is a "no trade" gap in S&P futures sitting at 1315, ... etc, etc. In addition to all of that stuff, seasonally for May, today had the weakest odds of being a positive day (See Day 20 below).


This brings up an interesting thought that we've all talked about before. The game has definitely changed from 5 years ago (I know... "duh"). But, some days it seems the best trading strategy is to just do the opposite of what the indicators are telling you to do. I know that sounds stupid... but on a serious note, I think it's important to make sure we really understand both sides of the trade.

With the playing field narrowing in the last few years, "left over" market participants are now faster, sharper, more patient, and have every tool available to make trading decisions. That's not even including the explosion in HFT Algo's... which throw in even more challenges to the market environment. This is a tough job and it's only getting tougher...

Tuesday Afternoon

Tuesday Morning

Gator's Chart of the Day: LVS
This looks to be a critical week for Las Vegas Sands.  They have the primo properties in Macau and Macau is the gaming capital of the world with five times the revenue of either Las Vegas or Singapore. 

The stock is in a bearish configuration with the 20 day simple moving average having sliced down through the 50 and approaching the 200 from above.  It has pulled back 25% from the April high and is forming a bearish wedge just under the 200 day.  All of that means there is considerable overhead resistance but there is a positive development; it bounced from the lower Bollinger band on the weekly chart (not shown but trust me) and printed a green candle.

The trade

The 200 day is the key.  If it fails to break through in a decent tape then it looks like it's a good place to short it (or buy puts or sell a bear call spread) but if it does clear that green line it could be the beginning of a retracement.  My target would be a 50% retracement which would take the stock to around 54.50.  That would also take it to the bottom of the big red candle from March 5th.

I'm long calls from last week and will either dump them on a failure or add on a break through the green line.

Monday, May 28, 2012

Memorial Day


As you know, Memorial Day commemorates United States men and women who have died in military service for their country. Please take a moment to remember all those who have served and continue to serve this great country.

A special Thank You to all the Veterans on the board...

Thank You for your service.

Friday, May 25, 2012

Weekend Thread

S&P Futures Daily Chart

S&P futures rallied right up to the 20day WMA during the night session and then chopped lower the rest of the day. The bulls are looking a little tired here. The Euro futures COT report released today is showing even more extreme positions than the chart I posted Wednesday... so that's getting pretty interesting. I'm wondering how much equity upside we will get if the Euro rallies next week (and potentially the rest of the summer).

I remember hearing the bobble heads recommending UUP a few times today... and we all know what great traders they are... lol.

Have a great weekend everybody!

Friday Afternoon


NSM
Nationstar Mortgage Holdings Inc. has been featured in IBD more than once in the past couple of weeks.  It had its IPO in March so you are looking at all of the trading.   They do not yet pay a dividend and maybe they won't ever pay one.  The stock is rated highly by IBD and the chart looks good to me.  They have options but not nearly enough liquidity for me to be interested.

While I would not recommend buying anything in advance of a 3-day weekend with all of the headline risk from Europe this one could be at a good buy point on Tuesday.

Fiday Morning

Gator's Chart of the Day: ROSG
Rosetta Genomics has been a rocket on insane volume over the last seven trading sessions.  Our own rookietrader caught much of the move.  (Well done!) 

There was news on May 16th that Novitas will be using ROSG's miRview mets2 assay for all Medicare beneficiaries and that could be what has been driving the stock.  After market today there was more news and it may very well drive the stock lower.

"PHILADELPHIA, PA and REHOVOT, ISRAEL--(Marketwire -05/24/12)- Rosetta Genomics Ltd. ("Rosetta") (ROSG), a leading developer and provider of microRNA-based molecular diagnostics, today announced it has entered into definitive agreements with investors to purchase an aggregate of 570,755 ordinary shares at a price of $11.50 per share in a registered direct offering. The offering is expected to close on or about May 31, 2012, subject to the satisfaction of customary closing conditions."

If you want to grab this tiger's tail be careful.  The moves have been fast and furious.

Thursday, May 24, 2012

Thursday Evening

The bulls stepped up in the last hour again and closed the S&P futures at about 1323. 1326ish is the high from Tuesday, and the 20day WMA is about 1331. Today was pretty choppy, but the bulls held the 1308ish level again. That level was tested 2 times in the night session and once during the day session today. S&P, Dow, and Russell futures closed on their highs of the day ... but the Naz futures lagged.

Thursday afternoon


Mechanically, trading is not hard :
  1. See trade
  2. Take trade
  3. Set stop and (optionally) target
  4. Tighten stop if appropriate
  5. If stop or target not hit, go to 4

Psychologically, however, trading (can be) very difficult and stressful.  Why is that, when the activity is relatively simple ?

Fear.  Just plain old garden variety fear.

Fear of losing money.
Fear of giving back money.
Fear of something bad happening.
Fear of being wrong.
Fear of failure.
etc.

I struggle with fear every bloomin’ day.  It causes me to miss good trades and to exit good trades too early.  I am making some progress on it, but not nearly quick enough to suit me.  For me, the best antidote to fear is concentrating on steps 4 and 5 above.  In other words, I’m trying to focus on the process, not the outcome.

Maybe I need this tattooed on my mouse hand :
Just move the stop, dumbass.

The best traders have learned not to be fearful.  They have confidence in their methods and know that they will make money over time.  Not necessarily today or tomorrow, but in total.

One of the best books I know to see how great traders do it is
Market Wizards: Interviews with Top Traders by Jack D. Schwager (which I will read again soon, and again and again until it finally sinks in, lol)

“Named must your fear be before banish it you can.” -- Yoda

Thursday Morning

Gator's Chart of the Day: FIRE
I'm taking another look at this internet/cloud security software vendor.  I've traded it before and I like the company and the industry.

The stock spent most of March and all of April in a volatility squeeze which resolved with a breakout.  It has since made a slow pullback to test the breakout and is now moving higher again with the 20 day sma as support. 

I had hoped for a tag of the 50 day sma to re-enter the trade but it didn't happen.  Now I'll probably take a small starter (1/4 of eventual size) and build if it continues to move higher..

Wednesday, May 23, 2012

Wednesday evening


Despite the bounce, PCLN appears to be in some trouble.  A rally up toward the 50dma would look like a short to me.  Careful with this one.

Wednesday Afternoon

COT Report - Euro futures (Sentimentrader.com)
With all the chatter about the Euro breaking down today... I thought it would be a good time to take a look at the latest COT report showing traders positions. I don't have much to say that you can't see for yourself... but one thing is obvious: Commercials are building long positions into this decline... and they are not doing it lightly. After watching the commercials build equity index shorts for months, and then the change in trend that followed... I am wondering what information they have that would encourage them to put such large Euro long positions on.

It could just be part of a broader currency hedging strategy... which would suggest this report isn't worth putting much weight on. Something tells me that isn't the case though, and that we will soon hear about some "plans" that have been going on behind the curtain. Whatever the situation may be... I thought it was something to be aware of.

Wednesday Morning

Gator's Chart of the Day: GEOY
GeoEye has been in the news recently as it made a bid for its rival, DigitalGlobe (DGI).  DGI is much bigger and it looks like the takeover will not happen.  In fact, now the speculation is that GEOY will try to sell itself.  With a P/E under 9 and its stock down 24% in the past two weeks it could be attractive.

The green arrow is pointing at the upper Bollinger band which is just starting to hook.  That frequently coincides with a change in price direction.  The stock is a bit thin with average volume just over 250k shares traded and its market cap is under $500 million so it's not a trade for the squeamish but it can be very low risk with a stop just under Monday's low of  18.96.

Of course if the general market condition is negative or if the news about Greece continues to be unrelenting and bad ..... take a pass.

Tuesday, May 22, 2012

Tuesday Evening

SP-500 Daily Chart (End of day)
Close enough to a doji for my purposes and the bottom tail just touched my horizontal support line that's been on this chart since we rolled over in early May.  It's one of several target levels I've been watching.  The last 10 minutes of buying today kept me from mass dumping of all longs.  If we are lower tomorrow after the opening rotation I'll probably hit the eject button and go to the dark side.

Tuesday Afternoon

S&P futures bulls have followed through on yesterdays rally. We now have a short term setup that looks ripe for selling. The reaction to this setup will be an important test for the bulls. The "overboughtness" can be worked off through time as well as price... so I'm thinking if we chop around with a slightly downward bias, it will provide a bullish setup going into the end of the week. On the other hand, if the selling starts to accelerate and we break below 1308ish in the futures ... it gives bears the edge towards retesting the lows from Friday. Either way, it's a tough spot to initiate trades.

Tuesday Morning

and the dog is named Greece
It's only a question of when the rest of Europe makes the same calculations and faces reality.

Monday, May 21, 2012

Monday Evening

S&P futures rallied right up to resistance this afternoon. The bulls have some heavy lifting to do, but did a good job of keeping a bid under the market today. The futures just closed at about 1316... and normally when we see the futures close near the HOD, we see some follow through in the night session. 1320ish is the next level up for potential resistance, assuming the bulls can hold onto the 1314 level.

In the short term (1-2days), we have a few technical indicators starting to look ripe for selling. In the medium to longer term (1 week-2months), we are set up pretty well for more upside. I'm guessing the action will continue to be sensitive to news flow as the bulls and bears battle it out.

Monday afternoon

Better to be out, wishing you were in
Than in, wishing you were out.

Monday Morning



Well Good Morning Everyone..As you slept, We had the Asian markets up (except for the Hang Seng) over comments from the China Govt that it could act more to spur growth. (The Flash PMI data comes out on Thursday for China and Europe fwiw, which may not be so good?) Over the weekend we had the G8 meeting which had no European plan in it, BUT agreement about providing supply of Oil if Iranian Sanctions take place (releasing the strategic reserves). The G8 comments brings us to our Topic of the Day, Will the KEY SUPPORT for Oil hold? It is bouncing off of it tonight. I am watching the 90.50 level for oil. Saudi Arabia pumped way too much oil expecting a shortage due to Iran Sanctions. China and the world is slowing and well, Iran meets with global leaders on Wednesday and at this point the gossip is that they are going to continue to behave to make sure that the July sanctions don't go into place. If the Brent "Risk" comes out of the market (its been falling since the last Iran Meeting), then support could be taken out when panic hits when everyone realizes that a glut of oil that has been pumped, heck even Iran over produced oil. Just something to watch. Goldman is out saying inventories could be in short supply and Russia is talking about Iran going to War. IMHO I raise an eyebrow to both GS and Russia with a possible very bias interest for those comments.

German/French EU Finance leaders are meeting to talk tonight, all the EU Finance Ministers meet on Wednesday. Bank of Japan starts their two day rate meeting tomorrow night and talk about that there is possible stimulus to lower the Yen, (which raises our dollar). During the Asian Session we had the eur/usd touch 1.2800 but it is pulling back. Oil in the Europe session is at 91.77. Canada is closed for holiday and we really only get FOMC Lockhart speaking tomorrow...and of course Gator's Birthday!

Friday, May 18, 2012

Weekend Thread

Markets closed on their lows and SPX gave up the 1300 level. There is no question the bears are in control. S&P futures had another high volume day today... and daily timeframe indicators are now looking the most oversold since 2008-2009. That doesn't mean we can't go lower... but I'm guessing we will see some upside next week.

A few things worth noting were the Euro and Gold strength today. Gold started moving up yesterday... and after struggling a bit in the early session, the Euro followed suit today. The latest COT reports released today are showing the smart money added to S&P futures shorts. They are still heavy short and that obviously needs to be respected. That being said, the COT reports only report positions up to Tuesday... and when you see big volume in the futures like we did yesterday and today, you have to wonder if they are covering.

I don't know about you guys... but I'm anxious to get this weekend started. I hope everyone has a chance to blow off some steam this weekend and rest up... we're gonna need it.

Special early shout out to our very own gator... Happy Birthday Gator!


Friday Afternoon

FB 1 minute chart at 11:45
Well it's finally open.  While it was holding 40 when I took the picture it's now slipping well below that.  There are going to be some very po'd people.

Friday Morning

Gator's Chart of the Day: FFN
Facebook it isn't but Friendfinder Networks, Inc. just reported earnings on Monday and Thursday it caught fire.  With a target price of 7 it has a lot of room to the upside but please be aware this is a micro cap stock with a market value well under $100MM.

You may or may not be familiar with the websites they provide services for (I'm not) but if you want a hot stock for a rocket ride this could be what you're looking for.  Average volume is over 500,000 shares so it should have enough liquidity for you to get in and out.

Thursday, May 17, 2012

Thursday Evening

Markets closed on their lows... SPX is flirting with breaking 1300. There are plenty of sentiment and technical indicators suggesting a rally is overdue, but it doesn't matter until it matters.

Thursday Afternoon

ALLT (Daily Chart at 11:45AM)
This one was a beaky mention from a few months ago.  It was written up in IBD print edition today.  The company is an internet traffic security software provider.  They specialize in deep packet inspection and have recently signed a significant telco as a customer.

Looks like the stock is sitting on support right here right now and testing the 50 day sma.  (The 50 day has not been terribly relevant.)  You could take a starter position with a tight stop for a low risk trade.  I have no position.

Thursday Morning

Gator's Chart of the Day: RVBD
One thing I learned from my time on the Rev's blog is that rallies in a downturn can be fast and sizable and I do expect we will see one soon.  Will it be Thursday?  Couldn't tell you.  When it comes I will look to participate but until then I'll continue to watch from the sidelines. 

Something I learned from Dan (and Smita and our Evanesce) is the pattern shown by RVBD.  They call it the Drop Dead Gorgeous.  The stock drops quickly from some event (news or earnings for example) and then it grinds a bit with little or no bounce.  Frequently that is the clue that it has further to go to the downside.  It's not unusual for the next leg to be as long or longer than the initial drop and you can see RVBD is still falling.  Is it a short right here right now?  Maybe but a better place would have been at 20.  Now it would be on a move up that stalls.  Looking at the chart I'd pick 17.50ish for that to happen.  I'm not predicting but ...

Wednesday, May 16, 2012

Evening Thread Wednesday

Quite a few charts look like the AAPL chart below. Diving down with not much support or sign of a bottom.  We all know that can change on a dime because some time soon we will have exhausted all the sellers.


HLF is David Einhorns personal yoyo.  It reports blowout earnings and tanks because Einhorn asks a question.  He makes no mention today and so it rallies.  Look to this one to continue to rally particularly in a strong market.


GOOG bucked the trend today and stayed strong all day.  It is now breaking out of a volatility squeeze to the upside and it has done it on a couple of pretty weak days.  Another one on the radar when we get our bear market bounce.


Wednesday Afternoon

Wednesday Morning


Sysin's dog and cat got tired of being passengers on the family road trip...
They jumped in front while the "humans" were making a pit stop.

Tuesday, May 15, 2012

Tuesday Evening

S&P futures 30min chart

Today was the 5th day the S&P futures faded into the close. Several indicators (sentiment & technical) are suggesting we are getting close to an important low. The big question is... at what level will it come?

You can see that the fan lines I've drawn in have marked some important targets so far. The lower fan line that you can't see matches up to about 1315-1320 for tomorrow. One interesting thing to note is the action in 10yr Treasury futures today. As the S&P futures dropped to new lows on the day, 10yr Treasury futures meandered around and did nothing. Sometimes that can be a heads up that equity index futures are getting ahead of themselves on the downside... so it's something I'll be watching closely tomorrow. Another interesting thing to note is the action in the Russell futures. The bulls held 775 again today as the S&P futures made new lows.

All things considered, I think we are setting up nicely for a summer rally. I'm being patient before entering on the long side... and will be looking for a solid move above 1363ish on S&P futures and 800ish in Russell futures for confirmation to get heavier on buying dips.

Tuesday Afternoon

CRM (11:50AM)
CRM reports Thursday after market.  It has held above the support line and I am hopeful that it will continue moving toward the resistance line around 150.  I will not be holding this through earnings and actually have half of my position for sale.  It should trigger if the stock reaches 141ish.

I don't think we will see any meaningful upside for the SP-500 unless there is surprise good news from Europe.  I am maintaining very high levels of cash.
Stare at the red dot on the image for thirty seconds.  Then look away, blinking several times and look at a white wall.  




As images get impressed upon our "sight", so can thinking....we have long been spoiled by the seemingly ever present dip buyers for quite some time.  The market complexion has clearly changed and it is time to readjust out "view".  

Monday, May 14, 2012

Monday Evening

Monday afternoon

What is a good trade ?

1.  You followed all of your rules.
2.  You entered with a definite plan in mind.
3.  You followed your plan.

That’s it.  Win or lose, if you did those 3 things, it was a good trade.  Pat yourself on the back.

Monday Morning

Gator's Chart of the Day: CRM

Salesforce.com reports earnings on Thursday after market so this is a very short term opportunity.  On Thursday the stock filled the late February gap on high volume.  Friday saw buyers come for the stock and it bounced on better than average volume.  Could this be a dead cat bounce?  Sure.  Could this last into earnings?  Sure.  I'm looking for a move towards 150 and would not hold through earnings if the trade develops.

I don't care for the equities market right now with all of the noise from Europe and if I do take a position it will have a very tight stop.  If the stock falls below Friday's low I'll be out.

Friday, May 11, 2012

Weekend Thread

Friday afternoon

Jamie Dimon
Risk is the only thing traders can control.   We choose how much (if any) risk we want to accept at any given time.  Any possible reward is subject to the whims of Ms. Market.

What is the proper amount of risk ?  Opinions vary, but most professional traders I’ve come in contact with recommend risking no more that ½% to 2% of your account on any one position.  Many daytraders (including myself) will also quit trading for the day if they lose more than, say, 1.5% on the day.  Larger values make it much more likely that the account will soon be wiped out.   Note that this percentage does not refer to “position value”, which could be a much larger percentage of the account.  Risk is the amount which would be lost if your stop is hit, barring overnight gaps.

Before entering a trade, it is essential to determine the price point at which you will admit that you are wrong.  The very first thing to think about is risk.  If the risk is too large, you should pass up the trade.  Don’t think about how much you could make - you have no control over that anyway.

As an example, let’s assume a $10,000 account and 1% max loss per position.  So we will risk no more than $100 on a position.

Looking at a $20 stock, first determine where the “wrong” point is.  Let’s say that support is 40 cents lower.  Give it a little breathing room and use a 50 cent stop.  In that case, the position should be no more than 200 shares ($100 / $0.50 risk per share).  The position value is $20 * 200 = $4000 (40% of the account), but the risk is only 1%.

For an options position which will be held overnight, consider the entire position at maximum loss and size accordingly.

Manage your risk.  Everything else will take care of itself.

FRIDAY MORNING


Good Morning Everyone! Well as you slept, the Chinese CPI data actually came in Stronger then estimates. Their Retail Sales and Industrial Production numbers missed estimates also. The miss on CPI data points to less of a chance of any action by the Chinese Government. Opec came out saying that Oil Inventories were higher and WTI Oil has pulled back to 96.20. Greece's third party is meeting tonight, the main parties in Greece must either form a coalition by today, or face a second General Election. So far, it appears the smallest party in the country’s parliament indicated that it was ready to join a pro-bailout coalition. The Democratic Left party has indicated that it may enter a coalition led by the centre-right New Democracy party and backed by the Pasok socialist movement. Pasok and New Democracy between them have 149 seats, two short of a majority. At this point, I don't see a deal in this mess...we will find out soon, plus we have a Spanish Bond Auction tonight.

For Today it is a BIG KEY MOMENT DAY, we have the SPX 1350 support (if it is taken out clean, then 1310.97 is the next fibo support), along with the WTI KEY 96.00 Oil Support and the KEY Eur/USD 1.2900 Support on our Risk Off Friday. After our day of rest on Thursday, it is clear sailing to take out all of these. German Elections on Sunday and EU Meeting on Monday are only major catalyst in near future. See what happens when you let a bear write for your blog, lol.

Thursday, May 10, 2012

Thursday Evening

CSCO closed down 10% on the day... but equity index futures shrugged it off after a bit of back and forth today. The bulls are buying the dip... and it should be interesting to see if they can follow through tonight / tomorrow.

Thursday Afternoon

Daily Chart (11:45AM)
CHD is doing the Energizer Bunny Dance.  It's working on it's 9th consecutive open green candle.  (Open candles have a higher close than open.)  If it closed right here right now it would be the 4th consecutive close above the upper Bollinger band.  For a dull and boring cleaning products company that's impressive.  No position.

Thursday Morning

Gator's Chart of the Day: CBS
Short and sweet .... earnings are already behind it.  Tags of the 50 day simple moving average have been relatively rare but consistently good buy points.  We got one that turned into a red hammer and we had follow through Wednesday on good volume.  Looks like a good place to start a position.  I have none ... yet.

Wednesday, May 9, 2012

Wednesday Evening

Coyote Pup
CSCO is getting hit after hours... down about 4%. We have an unusual setup when you look at the daily chart of the S&P futures. 2 days in a row prices were rejected under 1346-1347 (1350 SPX). The bears are working on it again here and it looks like tonight is going to be another volatile session. The picture above was taken in Colorado a few years ago... that little dude froze at the same time I did... lol.

Wednesday Afternoon

After a dip below the lows of yesterday in S&P futures, the bulls are pushing back and are trying to take it green on the day. There was a big volume push in S&P futures up to 1354 just now and it looks like some mild consolidation so far. Intraday volume is already close to 1.5m contract (pretty high)... which would put a high target area of 1360-1365.

Wednesday Morning Thread

Gator's Chart of the Day: CBRL
Cracker Barrel isn't a fast mover but there is an insider who really likes it.  Sardar Biglari (Chairman and CEO) has been buying regularly and frequently.  Beginning January 5th he has filed 33 separate Form 4's with the SEC representing 1,618,278 shares purchased.  His average buy is just over 49,000 shares.  He's been buying every month this year.  He now owns 3,803,165 shares having made his latest purchase on May 8th.  On May 2nd CBRL reached its all-time closing high of 58.74.

Earnings have been growing well over 11%/yr for the last 5 years yet the forward P/E is a reasonable 12.2 and 9.6% of the float is short.  That works out to 8 days trading to cover the short interest.  The company does have debt and almost all is long term.  The debt/equity ratio is 1.72 but they have consistently paid a dividend (currently yielding 2.79%) and the long term debt has been coming down steadily over the last 3 years from 779M to the current level of 540M.

If you want a steady grower (up 14%+ so far this year) with management on your side this looks like a good one.

Tuesday, May 8, 2012

Tuesday Evening


The SPY printed a nice hammer and it emboldened me to take some calls.










AAPL also printed a hammer, but it was red rather than green or an open box.  Is a red hammer fundamentally different from a green one?  Do these indicate a bounce?



Tuesday afternoon

Dirty Harry market

Do ya feel lucky ?

Tuesday Morning Thread

Gator's Chart of the Day: CHD
Church & Dwight reported earnings last week and it still has not slowed down ... but it just might be close.  (The chart reminds me of CMG just before it began a correction that has passed 10% and looks like it could still be going down.)  Today's move outside the upper Bollinger band on above average volume makes the chart look very extended.

CHD has a lofty P/E (19+) for a low tech company.  With a PEG well over 2 this stock looks like it's ripe for a decent pullback.  Institutions own 83% of the common and if they decide to take profits the stock may drop quickly.  If you are long a tight trailing stop on at least some of your position seems in order.

Note: All stats quoted are from Finviz

Monday, May 7, 2012

Monday Evening Thread


Could this be our next source of good news to get the rally going?

Monday Afternoon

After a Sunday night gap down open... S&P futures have grinded their way back up into the lows from Friday. AAPL is getting very close to filling its gap from earnings, bulls will need to hold the 550ish level to keep it in a range. Things are getting quiet, but don't be fooled... volume count on S&P futures is indicating a wider range for today.

Monday Morning Thread

Gator's Chart of the Day: SH
Europe is a mess.  The socialist won in the French elections and wants to raise the top tax rate to 75%.  The Greeks have thumbed their noses at the rest of the EU and will be defaulting next month when they don't get another round of bailout money.  The futures are indicating an open in the US markets that will be down about 1%.

The SH is the inverse of the SPY.  It looks good here.  It's cleared both the 20 and 50 day simple moving averages and looks like it will test it's recent highs above 37.  Volume for the last 3 sessions has been increasing and the last 2 were just above the 50 day sma.  With no obvious catalyst to move the markets higher this etf could be a good place to park for a while.  If you want more bang for your downside buck then you can pick up some SDS (double short the SP-500) but remember that like most (all) leveraged etfs do not expect it to perform at that 2X rate over a long period.

Friday, May 4, 2012

Weekend Thread


That was me this morning attempting to buy the dip... lol. After my stops were hit, it was pretty obvious what was behind me (a big train full of sellers). Long setups failed on almost every timeframe... which is something that's noteworthy. Today was basically the opposite of what we saw during the first few months of the year. When momentum builds in a particular direction, it pays not to fight it (I know... duh). We are working our way into the lows from April in S&P futures - 1352.50 is the low to watch next week. I'm going to post some charts in the comments - and still need to dig through the latest COT reports from today to see if there are any notable changes.

Friday afternoon

Enter in mild times
Exit in wild times

An old Wall Street saying, but I always try to follow it.

I like to enter during periods of consolidation (volatility squeeze), or right at a breakout from consolidation.  Stops can be tighter and the slow movement gives me time to study the action.  If the market is already running, then I have missed the trade.  I’m not a good chaser.

Wild times will often mark the end of a move.  Wide range bars, high volume, whippiness.  These are good times for me to exit a trade and wait for the next setup.

“A man’s got to know his limitations.” -- Dirty Harry