Monday evening

S&P futures traded in a tight range (5-6 points) today... closing within just a point or two of where they opened the day session. Oil and Gold continue to indicate that bulls are buying the dips... Oil is still flirting with 105 and Gold has been chopping higher towards 1700.

Monday afternoon

What is your primary timeframe ?

This is an important question to answer for your trading in general and for each individual trade in particular.  By primary timeframe, I mean the chart period which is used for entering trades.  For an investor, this should probably be a weekly chart.  For a swing trader, daily is probably appropriate.  For a daytrader, it might be 5min or shorter.  And since a lot of us operate in more than one of these modes, we have a mix of timeframes to deal with.

[ below is my interpretation of a couple of concepts I learned from Kurt Capra and other folks at Pristine.com.  Note that I am not always good about following these principles, but I think that they are good food for thought ]

Multiple timeframe analysis

Longer timeframes generally control over the shorter.  If the weekly is in a downtrend, then bounces on the daily might be good shorting opportunities.  If the 60min is in an uptrend, then pullbacks on the 15min might be buying opportunities.   etc.

Before entering a position, first determine which timeframe to use.  This is going to relate to how long you intend to hold the position.  Then look to a higher timeframe and decide whether it is working in your favor or against you.  If all lines up in your favor, you might also look to a lower timeframe to get a tighter entry point.  Some possible combinations :

Investor
Higher:  monthly
Primary: weekly
Lower:   daily

Swing
Higher:  weekly
Primary: daily
Lower:   60min

Day
Higher:  5min  15min  60min
Primary: 2min   5min  15min
Lower:   tick   2min   5min

I mostly daytrade index futures on a 2min chart, with guidance from the 5min.  If the 2min looks good but the 5min is not set up well, I will usually pass up the trade.  Sometimes I will look at a tick or range chart for a better entry, but my primary is the 2min.  

[ this is similar to the triple screen trading system detailed by Dr. Alexander Elder in his excellent book Trading for a Living ]

Mixing timeframes

After a trade is entered on your primary timeframe, it is usually better to not base your exit on a lower timeframe.  The reason for this is that a pattern which looks scary on a shorter timeframe is often just a pullback on the primary timeframe.  It is okay and often desirable to base your exit on a higher timeframe if you are looking to ride a longer trend.

This is not a hard and fast rule and there are cases where it makes sense to exit a trade based on something nasty happening.  But, in general, if you enter on the daily chart, set stops based on the daily chart.  Don’t get scared out by the 15min wiggles.  If you enter on the 5min, set stops based on the 5min and don’t let the tick chart scare you out.

Monday Morning Thread

Gator's Chart of the Day: RVBD

I opened a trade last week on the post earnings bounce.  It wasn't working and I dumped it but kept my eye on it.  Turns out I was not patient enough and bought it back as it started to show some life and I added as it continued to move up.

I'm looking for some gap fill. I don't expect it to head back to 25ish non-stop but I do like the 23 level to offer resistance and will likely be out of most or all of my calls before it hits that level.

Friday night thread

SPY pretty much filled the April 4 gap, but it wasn't what I call an impressive performance.  Still, the pattern looks ok.

My completely wild guess is that it continues higher, perhaps after a bit more pullback / consolidation.

Rydex Data

Sentimentrader Rydex Bear Flow Indicator

Sentimentrader Rydex Bull Flow Indicator

Index futures have been grinding higher since the morning dip, Naz and Russell are leading the way. I've been looking at the Rydex Data from last night (updated daily 11pm) and I'm thinking about the possibilities going forward. 

There is potential for another push lower that moves these indicators into the red circle zones I have drawn in.... and there is also potential for the current reading (blue line) to be close to some sort of low in the market. In other words, no clear setup at the moment, but it is getting a little closer to a "ripe for buying" signal.

Friday Afternoon Thread

CTRP - Daily Chart

This was Fitz' free video stock last night.  It has not jumped and maybe it won't but it looks pretty good to me.  No position yet.

Friday Morning Thread

Just as the bearish engulfing candle in Feb  (up arrow) was not indicative of the immediate future price action , I believe the bullish engulfing candle (up arrow) may too prove itself wrong in the short term.  There is still a huge unfilled gap from the action in early Feb .  I will be watching this one. No pos

Thursday Evening

AMZN earnings are being received well in the after hours session.... stock is up about 12% so far. Looks like our old friend the V is back in business.

I've come back to this post to edit.... S&P has cut Spain to BBB+ from A (Outlook negative). The bears hit the S&P futures with large sell orders immediately and current trade is about 1391ish. All of the sudden it looks as though a V shaped recovery is not in the cards... tonight and tomorrow should be interesting as market players digest the news.

Thursday Afternoon

WMT Daily Chart (11:40 AM)

The news has been mixed but generally ugly for the big retailer.  It bounced this morning from just above the 200 day sma.  That could be the short term (maybe long term) bottom if you want to trade it.  Volume has already exceeded the 50 day sma so clearly buyers are interested.

Thursday Morning

Gator's Chart of the Day: CF

CF Industries made an all-time closing high today.  The stock has been trading in a range of about $15 for ten weeks.  Wednesday's volume was well above the 50 day simple moving average and approached double Tuesday's turnover.  The company should be reporting in the middle of May so keep an eye out for that date.

If CF opens higher I think it can be bought with a stop just under the 20 day sma.  If it does move higher be aware that it is likely to pause and maybe pullback from $200 just because it's one of those round number things.  I have no position but I'll be looking at May calls.

Wednesday Evening

Wednesday afternoon

Trading requires patience

One of the problems traders struggle with (I certainly do) is the feeling that we have to be doing something all of the time.  After all, if we're not trading, we're not making any money.

But many times there is literally nothing setting up.  If a market or stock is just bouncing around, there's not going to be any kind of pattern you can base your trade on.  Identify these times by looking for ranges or for a bunch of overlapping bars.  If there's no identifiable pattern, the best trade is SOH (sit on hands).  It's better to watch and wait than to get chopped up and get yourself into revenge trading mode.

Before entering a trade, you need to know why you are doing it, where your stop is going to be, and where your estimated target should be.

As Todd Harrison likes to say ... "Am I trading or am I guessing ?"

Ask yourself that question periodically throughout the day and your results will improve.

Wednesday Morning Thread

Gator's Chart of the Day: EXR

This is a REIT so don't be concerned about the debt/equity ratio.  This is a cash cow with growing revenue streams.  It's also at an all-time high.  Volume has been above the 50 day simple moving average for the entire month of April.  That's good and bad.  The good is that there is a lot of interest in the stock and it's very liquid.  The bad is that it's not a hidden gem.  Folks know about it.

Tuesday Evening

Naz Futures Hourly Chart

AAPL earnings have been reported and the stock is having a positive reaction so far in the after-hours session... currently up about 5%. Naz futures bulls pushed up to 2675 so far and if you look at the chart above, you can see the bulls have some work to do. The 2683ish area will most likely be a battle ground tonight and tomorrow.

Tuesday Afternoon Thread

MCP daily chart (11:05 AM)

There's a gap down there.  Volume has been well below average for over a week but has been increasing for the last 3 sessions.  The last 4 bars are red and so is today's so far. 

There has been news that Japan has developed battery technology that does not require rare earth metals.  These batteries could be used in electric cars.  Unfortunately these have not been met with the demand many anticipated.

I am not aware of a catalyst to move rare earth stocks higher and many appear to be falling under their own weight.  If you want a short position this is one to consider.  I have no position.

Chart of the day LVS morning thread

LVS has been declining on decreasing volume.  Although there is nothing that resembles a washout, this appears to be a low risk buy on a stock that has done rather well. It bounced off the 50 dma yesterday. You could put your stop just below today's low of 55.96.  I have missed this whole run and it is possible also that this is a top as it has broken trend.  

Monday Evening

After producing a gap lower to start the day, the bears made a bit of progress in the early session. The bulls were buying the dip though - and spent the rest of the day on a steady grind back up to about where we opened the day session in S&P futures.

Monday afternoon

Market Cycle

Nobody is bigger than the market, not even the Federal Reserve.  No matter how much money they print, the basic market cycle will prevail.


I don't think there is any question that we are somewhere on the left side of this chart.  My opinion is that we are just past the point of "euphoria" and heading toward "anxiety".  We are certainly nowhere near the point of maximum financial opportunity.


While this is a big macro view for the purpose of investing, it also has implications for trading.  The days of JBTFD are probably behind us for a while.  This is a time to be very cautious with long positions and to demand high quality setups.  Honor your stops and don't be too quick to buy weakness.  For those who like the dark side, shorts are working again for a change.

Monday Morning Post

I had promised a rewrite of the Trader's Evaluation from the positive side.  The positive viewpoint is in blue below.

The first trading quarter of 2012 is officially over. Personally, I had some good days and I had some bad days. I thought it would be a good time to read through and reflect on a "Trader's Self-Evaluation Checklist" written by Brett Steenbarger, Ph.D.

1. What is the quality of your self-talk while trading?  Is it angry and frustrated; negative and defeated?  How much of your self-talk is market strategy focused, and how much is self-focused?  Is your self-talk constructive, and would you want others to be talking with you that way while you’re trading? Always stay positive about your trading.  Having a bad trade does not make you a bad trader.  Be certain that you will make money even if you aren’t or have not yet. 

2.  What work do you do on yourself and your trading while the market is closed?  Do you actively identify what you’re doing right and wrong in your trading each day—with specific steps to address both—or does your trading business lack quality control?  Markets are ever changing; how are you changing with them? Put work at night so you can trade effectively during the day.  Work on correcting your bad habits.

3. How would your trading profit/loss profile change if you eliminated a few days where you lacked proper risk control?  Do you have and strictly follow risk management parameters?  Remember one bad trade can skew your results especially if you don’t follow your risk management strategies.

4. Does the size of your positions reflect the opportunity you see in the market, or do you fail to capitalize on opportunity or try to create opportunities when they’re not there? Your position sizes should reflect your perceived risk I the market.  When the market is not trending or not trending your way keep your positions small.  When the trend is clear, enlarge your position.  If you are uncomfortable with your losses, then your position size is too large.

5. Are trading losses often followed by further trading losses?  Do you end up losing money in “revenge trading” just to regain money lost?  Do you finish trading prematurely when you’re up money, failing to exploit a good day? Money won’t be made every day.  Just because you lost money yesterday does not mean you can make up for it today.  There are certain set ups for each individual that will make you money.  Know what yours are.

6. Do you cut winning trades short because, deep inside, you don’t think you’ll be able to make large profits?  Do you become stubborn in positions, turning small losers into large ones? Cut your losers and let your winners run.  Take profits into strength, set trailing stops.

7. Is trading making you happy, proud, fulfilled, and content, or does it more often leave you feeling unhappy, guilty, frustrated, and dissatisfied?  Are you having fun trading even when it’s hard work?  Trading should be enjoyable.  Although we never feel like we take advantage of all our opportunities, you should be proud more often than discouraged.

8. Are you making trades because the market is giving you opportunity, or are you placing trades to fulfill needs—for excitement, self-esteem, recognition, etc.—that are not being met in the rest of your life? Be certain that there are trading opportunities.  Don’t be trying to make up trade, get excitement, etc 

9. Are you seeking trading success as a part-time trader?  Would you be seeking success as a surgeon, professional basketball player, or musician by pursuing your work part-time?

10. Can you identify the specific edges you possess over the many other motivated, interested traders that fail to achieve success in the markets?  Do you really have an edge, and—if so—what are you doing to maintain it?

Friday Evening Thread

Do you know these faces?

This weekend one of them could be elected

It will likely have a significant impact on our markets and definitely make a big difference in Europe.

One of them wants to put the marginal tax rate at 75% and make a big increase in the minimum wage. 

Friday Afternoon Thread

Do you feel lucky, punk?



SWHC daily chart (11:50 AM)

Lots of talk about RGR lately but don't forget about Smith & Wesson.  It's moving through volatility squeeze and could be ready to pop or should I say BANG!!!

Friday Morning Thread

MLNX daily chart.

Short squeezes happen. MLNX reported better than expected earnings on Thursday morning. They also upped their guidance. And there were at least 2 analyst upgrades Thursday morning. Add to that, at last report, the short interest ratio was 8.20, meaning 8.20 days of average daily volume to cover the short interest.

MLNX trades about 250,000 shares per day. It traded over 5.2 million shares today and was up a whopping 52%. Trade 'em if you spot 'em. You know the algos were in there.

Thursday Evening

After a wild ride in the early session, the bears took over and closed us lower on the day. That was another failure at the 20day WMA. MSFT is having a positive reaction to earnings so far... up a couple percent in the afterhours session. S&P and Naz futures are showing today as the highest daily volume in the June contract.

Thursday Afternoon Thread

CHK Daily Chart (11:45 AM)

If you ever see a chart like this ...... RUN!!!!  This is an all-time low for Chesapeake.  Maybe an all-time low for Aubrey and the Board of Directors too.  No position and not interested in one either.

Thursday Morning Thread

IBM daily chart.

I started out with about 4 bullish setups in mind. Then I realized I wasn't feeling particularly bullish. So I thought I would throw a bearish setup out for my own contribution, realizing it might be volcano fodder as well as any other setup. IBM was a large portion of the drag on the Dow 30 on Wednesday.

IBM reported earnings Tuesday night and the news was sold Wednesday on 3x normal volume. But there are alot of ominous things on this chart, as I see it. Wednesday's low was 200.00. The close was 0.13 higher, at 200.13. If you look at this chart, 5 of the last 7 candles pretty much have no wick on the bottom of the candle, meaning the stock has closed on the lows for 5 out of 7 days - and that was before Wednesday. Wednesday's (open and) close were below prior support where the bottom of those 7 prior candles sit. (I was going to draw a support line on the chart, but I wanted you to be able to see the bottoms of those candles with no wicks.)

Wednesday's close was outside the lower Bollinger bands - which are narrow, even with Wednesday's spread - at only 5% distance. Wednesday's close was also below the 50 day moving average. I am thinking that a move below 200 will trigger more stops. We could have a volatility squeeze with a downside resolution.

Wednesday Evening

Naz Futures Daily

I deleted all the trend lines to get a clean image of the action around the 20day WMA. The bears have been putting up quite a fight over it as you can see. Today was another rejection, and tomorrow's number is about 2721ish. Those two big volume days suggest a lot of positions are changing hands.... and since we know the commercials are still heavy on shorts, I'm guessing this Friday's COT report will show they have been reducing short positions into this decline.

Wednesday Afternoon Thread

ADY daily chart (11:35AM)

Another demonstration of the power of the volatility squeeze.  Very good volume on the breakout.  If you buy put a trailing stop on some of it as the typical pattern is the stock will top out and pull back to test the breakout.  I have no position because options are not an option.

Wednesday Morning Thread

Gator's Chart of the Day: SPY

The daily chart of the SPY has three arrows; green, white and red.  The colors have no significance other than differentiation.  The green arrow points to the vertical line that marks the beginning of the January earnings season and the red arrow points to the beginning of the current season.  The white arrow marks 2 months from the green arrow where momentum from the good earnings reports died.

So far earnings have been very good this season.  Even AA and C surprised to the upside.  GOOG was not bad but the stock split has traders confused and wary of what Eric has up his sleeve.  INTC was good and CSX had great numbers too.  So we have materials, financials, social media and semiconductors represented.  The home builders have been decent lately and reports of improved housing demand from Florida suggest we could be near a bottom in at least some of the worst parts of the county.

Could the red arrow mark the beginning of another 2 month run and new multi-year highs?  Maybe, but it could also be pointing to a developing right shoulder.  Europe is in focus Thursday with Spain's bond auction and we have not managed two consecutive up days since the market peaked a couple of weeks ago.

I may be missing the beginning of the coming run (if it is to be) but I cannot build positions in a choppy market.  I'll continue to be very selective and mostly day trade until I see a trend.

Tuesday Evening Thread

Tuesday Afternoon Thread

The children's game is called "Fruit Basket Turnover" - a version of musical chairs. According to wikipedia: The players are divided into equal-sized groups, with each group having the name of a fruit. A circle is formed with a number of chairs equal to one less than the number of players. One player will be left without a chair, and will stand in the center of the circle.

The player standing in the center calls out one of the fruit names. When this happens, all players in that group must stand up from their seats and move to another seat in the circle. The player in the centre must attempt to take one of the free seats while the other players are moving.

Instead of stating a fruit name, the player in the centre may call "Fruit Basket Turnover!", in which case everybody must move to a different seat.

Today we have stocks like LVS, BWLD and SBUX which have held up well in the past week, selling off, while the rest of the market is enjoying a breather from the selling. Fruit Basket Turnover. The children's version is more fun.

Tuesday Morning Thread

Gator's Chart of the Day: JBHT

I looked at over 200 charts Monday night and this was the most attractive (from a long perspective) one I found.  They just reported good earnings with a beat on both top and bottom so that is not a near term concern.  Volume has been above the 50 day average both before and after earnings but today's bar is a little shorter than Friday's.

I think the better entry is on a pull back to the 20 day sma but if you just have to buy something a small position in JBHT should be OK.  Just keep a stop under the previous day's low in case buyers have got all they want for now.

Remember, cash is a position too.  Right now it might be the best one.

Monday Evening Thread

AAPL Daily Chart

Apple closed below the lower Bollinger band (584.49) today.  It has not done that since 11/21/2011 (green arrow) when it was testing the 200 day simple moving average from above.  It bounced on less than impressive (less than average) volume then.  Today volume was the highest since 03/15 when the stock printed a big red candle and closed at 585.56. 

The ellipse highlights the gap that just begs to be filled.  The bottom of the gap is 568.18 and the 50 day is now 559.  Tomorrow those figures will be even closer together (it's a math thing) and I will be watching that level very closely.  It could prove to be a great buy point with a super tight stop for very small risk.

Monday Afternoon Thread

AAPL and GOOG together make up over 20% of the Nazz 100 as I understand it. AAPL itself has the largest weighting in the SP500. So these market heavyweights must be taken into account. Can the market move up without them? Yes. Will it be hard? Yes.

AAPL, after a mere 2 hours, has already traded over 19,000,000 shares. The 50 day average volume is "only" 18,120,000. The chart for PCLN, another market leader, looks about the same, with heavy volume. GOOG looks the same, with volume already exceeding the 50 day average.

I varnished something this morning and am working on my earnings list. Trade safe.

Monday Morning Thread

Gator's Chart of the Day: ORLY

O'Reilly Automotive reports earnings on Wednesday, April 25th after market.  It has been moving steadily higher since the last report in late January when it reacted poorly with a "sell the news" response.  That is likely to happen again in this market but it is also likely that it will continue to perform well until that event.  Notice the sharp run it made into the last report.

I think it is unlikely that ORLY will move through 100 (it's the round number thing) but it would not surprise me to see it get close before it reports.  Of course if the rest of the market corrects O'Reilly will probably pull back too.

Friday Evening Thread

THE important number for the week on the SP500 was 1370. Why? 1370 was the 2011 high. It was also the level for the 50 day moving average on Monday, though the 50 day moving average has since moved higher to about 1375. 1370 was also the resistance level back at the end of February (an area perhaps to be known as "the left shoulder").

So where did we close the week? Yes indeedy. 1370. So we are just barely back below the 50 day moving average.

Sector update: JPM and WFC reported earnings this morning, and regional banks were the worst performing sector (KRE) on my list. (Your list may vary. LOL) AAPL was down almost 3% today on volume, and closed below the 20 day moving average for the first time since December. Metals and mining were weak all around, from gold, silver, coal, steel, copper. Energy (oil, OIH) were also weak, though perversely UNG closed up 0.01.

Next week we have many more earnings reports against a backdrop of historical positive seasonality. Clearly we are at an interesting juncture in the market.

Friday Afternoon Thread

Not yet ready but watch: NUS

A nice uptrending stock that we don't talk about.  It's consolidating around the 50 day and probably needs a few more days but it's getting close to the trend line.  a buy around 57 appears in order and you could use a dollar stop for low risk.  No position.

Friday Morning Thread

In these sell-offs, I look for stocks that are weak, but also for stocks that are extra strong. SBUX fits in the extra strong category. I would NOT buy this stock right here, right now. It has just has 2 really big up days in a row. Note the volume on those up days. Big volume. Bigger volume than on the "sell-off" on Tuesday. There are very few charts which have this much action above the 10 day moving average in the last 2 weeks. The last time this stock was in touch with the 20 day moving average was March 7. I would look to buy it on any pullbacks and the closer to the 10 day moving average the better.

I let myself get stopped out of this stock when it barely went below the 10 day moving average last week - but I had a nice run. I would get back in on any pullback, as I believe SBUX has regained its mojo. This is one of Cramer's strong stocks he is pounding the table about right now, and I would rather have Cramer with me than against me on a trade. Earnings are Thursday April 26 after the close.

Thursday Evening Thread

Russell Futures Daily Chart

This is a zoomed in daily chart showing the breakdown (812ish) from Fridays holiday session. Tuesday showed the heaviest daily volume of the June contract... which can sometimes indicate a reversal is near. The bulls stepped up and held that 780 level and have since produced an impressive rebound. There is major resistance above between 812-815... and I don't think a V-shape move back to new highs will be so easy this time.

Thursday Afternoon Thread

I thought I would continue with Gator's SPY chart for the day. There's good news and bad news. First the good news: The action so far today has been inside the Bollinger Bands for a change and we moved back above the 50 day average. Some individual stocks have set new highs including SBUX and CMG. Is there room for more upside? Well - those in the "all gaps will be filled" camp will be watching for the gap between 138.78 and 139.26 to be filled.

The bad news: See that rectangle. All the buyers in there are losers. Fitz talks about a "3 day rule" Smart money buys on day 1, not so smart money buys on day 2, and whoever's left takes the smart money out of the trade on day 3. Some market leaders, notably AAPL, are NOT leading today. Trade safe out there.

Thursday Morning Thread

Gator's Chart of the Day: SPY

Hurray we had an up day!!! After five consecutive red candles we have a green one!  We've been saved by that earnings powerhouse AA.  Now we'll see the "V" move back to new multi-year highs.

Wednesday was an inside day where the entire candle (even the wicks) was contained by the body of the preceding candle.  Volume was above the 50 day moving average but well below Tuesday's big down day.  Price never did get above the 50 day average and we closed below the 1370 level that many see as important.  It didn't even close inside the Bollinger bands.  (Bottom band = 137.10)

The market leaders like AAPL and PCLN were down and CMG and IBM closed near their lows.  I wouldn't even say this was a dead cat bounce.  Dead cats are livelier than this market.  The Beige Book report makes it unlikely that Ben will be acting anytime soon.  Besides, he needs to save a little something for a strong pre-election sprint. 

We may move higher from here but that could just be construction of a right shoulder and that would suggest a move back down to 127 or lower.  (Trust me on the neckline.)

This is the kind of action that can just chew up traders trying to build positions. 

In case you didn't recognize it I'll tell you that was the voice of experience.

Wednesday Evening Thread

I dare not even think the words "dead cat bounce" with you-know-who in the room. But the fact remains that 2 of the market leaders, AAPL and PCLN, were unable to finish the day green. And the SP500 was unable to hold above 1370 which is both the 50 day moving average and the 2011 high.

The Nazz Composite and Nazz 100 are both above the 50 day average still, but those indices were quite extended because of AAPL and PCLN. The lack of bounce in the 2 leaders does not bode well.

Tomorrow brings the first "tech" earnings report from GOOG after the close, and Friday morning we hear from both JPM and WFC in the banking sector. For now, the bulls and bears can both say "The fat lady hasn't sung yet." Now, where's my pizza?

Wednesday Afternoon Thread

VXX - Daily Chart (11:40AM)

Looks like an equity that has found a bottom and is moving up quickly to test resistance around 26.  I have no position and that looks like a mistake.

Wednesday Morning Thread

Gator's Chart of the Day - SP-500

Just a quick look at the SP-500 ... OK, that's enough.  You can't see the volume well but it was the highest in over a week and the tallest of the last five red bars.  I've drawn several horizontal support lines and one of them is very likely to be a good buy point.  Pick the one you like and wait for it.

Tuesday Evening Thread

It's a bear day in the market when ... the sectors that are green are either bonds (TLT) or precious metals, and everything else is down 1% or more. Gold miners (led by GDXJ with GDX and SIL) were also green. Goldman Sachs upped 2 homebuilders (TOL and PHM) this morning, and the group (XHB) still finished dead last on my list today, down over 4%. Hopefully all the bloggerz protected their capital and will live to fight another day.

Tuesday Noon Thread

We are at a critical point for the SP500. 1370 was the 2011 high, and the 50 day moving average is about 1371. In addition, we have not closed below the 50 day moving average since December 19. Don't everybody hold your breath at once. Breath. Breath.

Tuesday Morning Thread

Gator's Chart of the Day - SNDK

SNDK - Weekly Chart

SNDK - Daily Chart

Sandisk warned last week that they were seeing weak demand and that the quarter may be disappointing. You can see the market response on the daily chart. Looking at the weekly chart there is no nearby support.

There are two trades here with different time frames. For the nimble there is a very short term bounce that is likely as the stock has spent the last 3 days below the lower Bollinger band set at 2 standard deviations and 2 days outside the 3rd standard deviation band.  (Fitz says the 2nd standard deviation should contain about 90% of all data points and the 3rd should contain nearly 99%.)  I expect to see a bounce back inside the tighter band (2 s.d.) which would be above 44.82.  It is not likely to last though.

On a longer term (given the outlook from the company) we could see the "Drop Dead Gorgeous" pattern developing.  That's when the stock drops and then doesn't make much of a recovery  and grinds sideways for a short interval and then takes another leg down.  This trade could set up very quickly following the bounce trade.  Wouldn't it be sweet to have the stock pay you off both ways?  It could happen.

Monday Evening Thread

FAST was an IBD 50 stock not that long ago. We know that often former leaders tend to lead on the way down. FAST finished today at a critical juncture, sitting right on the 50 day average. It is hard to see on this chart, but the 3 red days out of the last 4 have been on high volume. It received a downgrade on Tuesday, April 3 which kicked off the selling. I saw no news today. FAST reports earnings Thursday morning before the open so I see no reason to buy at the present time. It might be one to add to your "potential short" list .... or if earnings are good ....

Monday Noon Thread

EBAY was at high of day even in this noon swoon. Textbook bounce off the 50 day moving average. Remember that somewhere around 40% of earnings come from Paypal - making this almost a financial like V and MA. Another chunk comes from Stubhub - the on-line ticket broker which they own. So while it is labeled as a catalog retailer here - we know better.

Monday Morning Thread

Gator's Chart of the Day: TSCO

The lousy employment number reported Friday has whacked the futures but as I write this (Sunday night) we are seeing markets around the globe stabilizing.  We should see a gap down open but I am looking for opportunities to buy on a bounce.

TSCO has been stair stepping higher all year and we will see if it can hold the most recent move.  If it does I think it's still a buy.   Farmers got great prices for last year's crop and Tractor Supply is where they spend a lot of cash.  Retail has been surprisingly strong and I think TSCO will continue higher into earnings. 

I have no position bu I'll be looking for a pullback and then buy the bounce.

Good Friday - Easter Weekend Thread

March Non-Farm Payroll numbers came in lighter than expected today.

Courtesy of Beagle: +120K vs consensus of +201K, prior 227K.

S&P futures were immediately hit by sellers and closed down around 1%. Treasury futures jammed up and are pushing new highs as I'm typing... 30yr futures are up about 1.40%. Euro futures saw an initial spike down, then immediately jammed up to 1.3119 before settling back around 1.3090ish now.

I hope everyone has a great Easter weekend!!

The futures markets will open Sunday night as usual at 6pm Eastern Time.

Thursday Evening

COT Report - VIX Futures (Sentimentrader.com)

With the recent increase in volatility, I thought it would be interesting to look at the latest COT report on the VIX Futures. It's interesting to note the level of positioning by the commercials. The only other time they had this much long exposure was near the peak of volatility in 2008-2009. So.... if they were heavily long near the peak back then, what does that mean for the VIX going forward? Inquiring minds want to know...

Cash markets are closed tomorrow for Good Friday, but equity index futures will be open until 9:15am Eastern Time.

Thursday Afternoon thread

AIG. baron/southern special. Now that baron is out of part of his SMG trade, he has moved on to another devil stock and is making money there. Earnings should be in early May, so the stock has another 4 weeks to run before that worry. Yesterday's move was on heavier than normal volume on an otherwise red day in the market. That means something. I have no position in this stock.

Thursday Morning Thread

Gator's Charts of the Day: CIE STX

CIE

STX

I couldn't decide between these two volatility squeeze candidates so I flipped a coin ... no help ... it stood on edge so you get a twofer today.

Actually the analysis is the same for both.  After a gap up the stocks are trading sideways on average volume just looking for a catalyst.  Although the 200 day moving averages are well below current price the 50 day is providing near term support.

With the long weekend coming it may not be prudent to start new positions but you may want to set price alerts that will bring your attention to a move to the upside (or if you're one of those nasty short sellers, to the downside.)  In any case if the trade develops it seems prudent to put a stop just under the 50 day for a long position or just above it for a short entry.  (I assume the short short position would be established under the 50.)