Thursday, September 20, 2012
9/20/12 Risk off
In addition to closing TBT yesterday, I closed BAC premarket @ 9.20 for a minor gain. Plan to close remaining positions either on strength during the regular session, or at the close (including mutual funds). When I'm wrong on crowd behavior, I take losses immediately. I've found that keeping losses small allows me to maintain an even keel- and trading is all mental. Should have closed all positions yesterday, but I was betting the Bank of Japan annoucement would lead to further gains on a delayed reaction basis- instead, it was met with further selling.
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Picked up a little more YRCW at $6.6 again. not sure why this seems to be a little support. I do see a fib retracement line around $6.56.
ReplyDeleteJeff Saut worth a listen to this morning. Moving away from his pullback call and towards a sideways working off of overbought reading follow by a lift to the upside.
ReplyDeletehttp://www.raymondjames.com/multimedia2.htm?url=Saut_Daily.wma&player=wmp&target=int&width=300&height=0
i know it's worthless to guess on the short term direction of the market, but if i had to guess we retest the highs soon and then selloff. the more guys like saut that expect a sideways move instead of a pullback, the worse it is for the market.
DeleteDollar support area 78~79, thus a rally from here would tend to stymie PM's, commodities, and to some degree, stocks?
ReplyDeleteUGA - Bouncing off 50SMA support area
ReplyDeleteOil - Funny thing is, Saudi Arabia has said their target for oil is $100, and while at the same time, they've supposedly increased production.
ReplyDeleteChina PMI - Still contracting, which tends to pressure enthusiasm for risk on.
ReplyDeletePlatinum - I believe South Africa made some progress on their mining labor issues over the weekend.
ReplyDeleteSAN - Assuming Spain is the immediate concern?
ReplyDeleteNSPH putting in what looks like a bull flag.
ReplyDeleteI freaking hate mutual funds. Of course, I knew ahead of time what the rules are.
ReplyDeleteknowing what / when to buy is quite simple if you look at a chart:
ReplyDeletenew uptrends:
confirmed when a bottom is put in and then the subsequent rally is higher than the previous high (better if rally is on heavy vol). pullback must be on low volume. look for buy on confirmation of the next move up. confirmation is simple: draw a downtrending line from the highs of the most recent rally...a break of that triggers the buy. ideally the break should be on higher vol.
the reverse is true for new downtrends. when the market is in an uptrend or above it's 200 DMA, look for new uptrends. when a market is in a downtrend or below it's 200 DMA look for new downtrends.
right now the best looking chart i can find is DMND.
YRCW is also a good looking chart, but confirmation is needed. that would be a rally above $8.3
Deleteyou can also have confirmed momentum trades...for these look for stocks that continue to put in bull flag after bull flag. MSON is one i'm looking at. NSPH is another. REED is another. look at those charts and try to determine when it was a good point to buy...what signaled those buys. for these types of stocks i like to know the fundamental story behind the stocks as well so i also look to understand the potential ongoing catalysts for those types of stocks.
ReplyDeletetypically for these i screen for stocks with high rev growth + 30% gain over past quarter + 10% + pullback over past month. i also like to screen for a move above the 200 DMA with a recent pullback. remember the chart is predicting what will happen with the company in the future. so sometimes i won't screen for rev growth because that might be coming down the road and the initial move in the stock is predicting it.
Deleteif i like the chart i'll read the story on the company. are there catalysts to propel it higher? are the catalysts short term or longer term? does the company have a decent balance sheet? if all check off then what is the good buy point? remember there are thousands of stocks to choose from. if you miss a move then just move on to the next one. no sense in beating yourself up on the missed opportunity, but keep that stock in a watch list and wait to see if it pulls back. just because you missed the move doesn't mean you can't make money off it in the future. look at the run from $1.80 to $18 in REDF 2 years ago. there were 3 opportunities to make massive gains in the stock.
Yeah, might be forced to add onto NSPH in the low $3's if it won't make it back to $2's. MACD on daily looks like it wants to turn back up soon.
DeleteThought NSPH might retest the trend line going back to mid July(intersect ~$2.80), might still get lucky...
i think a good buy point on NSPH is above the lows from yesterday. i think the high volume move from a couple of days ago was a confirmed break above the recent consolidation.
DeleteDF - Damn, coulda' had this one at $12... OBV looks good too.
ReplyDeleteAny idea's why WPRT is under so much pressure?
ReplyDeletegotta shake out new longs and retest recent lows?
DeleteBack to 21? That's some nasty shaking!
Deleteyeah man...it is.
DeleteWhen I enter the SLV ticker in Google finance, the only news items /opinions I see at the right are the ones hugely bullish on silver. So no wonder silver has stalled after the QE3 announcement. In fact, we may need to see a strong washout in silver to shake out the weak hands before silver is treated with suspicion again and people start *gradually* chasing it up (as opposed to en masse entry last Thursday, after which no buyers remained).
ReplyDeleteActually, this morning SLV did drop below the lows of the past 2 days, so that should have shaken out some people who placed stops at those lows. We'll see soon whether that was enough or whether SLV needs to break below Monday lows to really scare those who got onboard last Thursday/Friday.
DeleteAlso, the dollar is at a support area now.
Delete