BITCHING ABOUT BARAK

Normally I do not use this blog for rants/opionins, but I have to today. The reason why I took over my own retirement accounts to trade on my own is that I am a non-believer in financial advisors. Maybe it is a narcissistic view on my part, but I know I can do better than him/her since I am in control of my own destiny. Also, watching the disaster after Hurricane Katrina opened my eyes to make me realize that our federal government is not able to protect me in time of need. I need to protect my family. The feeling of entitlement in the US of A is going to be its ultimate demise. Truly, I wish others understood that the government doesn't owe you one thing other than to defend our sovereign rights and our borders. Since the government is failing that too, I believe we are in a death spiral.

More reason to add weight to a plummeting plane - Barak Obama thinks he can save Social Security by eliminating the earnings cap on Social Security. Currently, the maximum any person pays into SS is $97,500 based upon their income and he wants to eliminate the cap completely. In essence, this is fleecing the high income earners since they are the ones who will be most affected. As seen in the op-ed by Investor's Business Daily "Social Security willl have an unfunded liability over the next 75 years of more than $27 TRILLION in 2003 dollars." This is just another HIDDEN TAX INCREASE. Why do I say it is hidden? It is not seen as an increase in our income tax rate, but is hidden into the taxes that are already paid, but capped.

Businesses will be hit hard as they already pay both the EMPLOYEE and EMPLOYER PAYROLL TAXES. If a business has to pay both, the business will have to eliminate employees to continue to make a profit. Unemployment goes up, entitlements increase and recession sets in. Butthead Barak also fails to recognize that eliminating this cap will increases taxes for "97,065 carpenters, 110,908 police officers, 254,992 nurses, 208,562 teachers and 237,000 dentists."

My opinion, PRIVATIZE SOCIAL SECURITY. So far the federal government has used the funds in SS to pay for Medicare costs in the form of IOUs. Well, those IOUs are going to be called in mid 2010s.

You want to save SS, Barak? Don't allow illegal aliens SS. Don't allow their family members who still live outside of the US to receive SS benefits. Teach people to "fish" rather than giving them their "fish for the day." Don't continue to tell them that the federal goverment has the obligation to provide for them.

I believe in capitalism and my wealth should not be taken by the federal government to be distributed to people who believe the government owes them something. That is communism. If the government takes away my money to distribute amongst them, why should I continue to work hard for the same reward of someone who sits on their butt and collects the $$$ that I put into SS. My reward for working 60 to 80 hour work weeks is a 6 digit income so get your f*%*&*%$ hands out of my pockets, Barak!!!!

LET'S GO INTERNATIONAL AND "DIVERSIFY"

My trading rules state only 5 stocks should be in my portfolio if I have between $250K and $1 million (See September 14th blog). Well, all the stocks that I have money in are well overextended and not in a buy territory and I still have money sitting idle in cash. Since the overall market is in a rally, I need to be 100% in the stock market and 0% in cash. So I pared off some of my OMCL and used up my cash to buy NBG. Below is the reason why.


In scouting for stocks that are breaking out, I cam across NBG which is just out of a cup and handle. (click on this to read about the chart pattern) The proper buy point is $12.89 thus making the maximum buy point $13.53.

Here are my purchases:

NBG BOUGHT 3900 @ $12.91 ($50,356.00)NBG BOUGHT 1000 @ $12.93 ($12,937.00)
NBG BOUGHT 1100 @ $12.9199 ($14,211.89)
NBG BOUGHT 100 @ $12.9199 ($1,298.99)
NBG BOUGHT 2800 @ $12.91 ($36,155.00)

Here is my OMCL transaction:

OMNICELL COM INC (OMCL) BOUGHT 700 @ $23.4253 ($16,397.73)
OMNICELL COM INC (OMCL) BOUGHT 1,000 @ $23.5829 ($23,582.93)

OMCL SOLD 700 @ $27.95 $19,565.00
OMCL SOLD 500 @ $27.9801 $13,982.83
OMCL SOLD 500 @ $28.0001 $13,992.83

Also, here is the graph of the portfolio that I am following. Again, the picture comes from the Scottrade account that I am managing. Account balance as of 06/01/2007 was $20,000. Currently it sits as $44,331, a 122% increase. The only stocks being held in it now are JASO and MR.



GOOD LUCK TRADING.
JD

FOREX AND EQUITY TRADING SYSTEM / STRATEGIES

Hope you forgive me on this one. I am basically making this as a "journal entry" on this blog and their is a lot of code on my part. For those of you who don't trade as of yet, I would just pass on this submission and move on to the one below.

System 1: 7/20/50 Cross Rules

BUY: when 7 day EMA crosses over 20 day EMA if both are above 50 day EMA

SELL: when 7 day EMA crosses below 20 day EMA if both are below 50 day EMA.

Goal is 5% profit

System 2: ADX(14) Crosses PDI/MDI

BUY: Buy when ADX(14) crosses MDI(14) and ADX<30

SELL: Sell when ADX(14) crosses PDI(14) and ADX<30

Goal is 20% profit or if 20% gain in 3 weeks, hold for at least 8 weeks

System 3: MACD Histo

BUY: MACD Histo crosses ABOVE zero and equity is ABOVE 30 day EMA.

SELL: MACD Histo crosses BELOW zero and equity is BELOW 30 day EMA.

Goal is only 5%

System 4: Cross PDI/MDI and 3 day WMA & 22 day EMA

BUY: Cross PDI/MDI and 3 day WMA > 22 day EMA

SELL: Cross mDI/pDI and 3 day WMA <>

Goal is 10%

System I haven't tested yet:

ADX + MACD HISTO (Trending)

GOAL - capture 40 to 100 pip moves in forex, or 5% in equities
Stop loss is latest low for forex and 10 day EMA for equities
ADX14 cross MDI/PDI and MACD HISTO >0/<0 = go long/go short
Best time frame is 4 hour or daily.
Some modify to ADX9.



Here is a different example of a trading system / strategy:
Buy when: Fx pair is ABOVE 30 day EMA and MACD Histo crosses above zero.
Sell when: Fx pair is BELOW 30 day EMA and MACD Histo crosses below zero.

(MACD Histo settings are 8,17,9)

Goal is 50 to 100 pips.

THANK YOU JASO!!!

I was able to jump in and buy shares of JASO. Boy, I expected the stock to retrace for a little while and not make such a move on Friday. The reason why I have a huge grin on my face is that it was a 13.58% move in one day from the $40.27 price. Here are the transactions:

9/21/2007 JASO BOUGHT 100 SHARES OF JASO AT $40.27 ($4,034.00)
9/21/2007 JASO BOUGHT 200 SHARES OF JASO AT $40.27 ($8,061.00)
9/21/2007 JASO BOUGHT 800 SHARES OF JASO AT $40.27 ($32,223.00)
9/21/2007 JASO BOUGHT 500 SHARES OF JASO AT $40.27 ($20,142.00)
9/21/2007 JASO BOUGHT 300 SHARES OF JASO AT $42.38 ($12,714.00)
9/21/2007 JASO BOUGHT 200 SHARES OF JASO AT $42.38 ($8,483.00)

Since I bought JASO, I am not considering buying CNH based upon my rules of limiting the number of stocks I can own. I have updated the Yahoo! toolbar on the right to show which stocks are in my portfolios.

GOOD LUCK TRADING.
JD

Info for me:
38631529 FM, 38623275 FM, 38627642 FM, 38628670 FW, 38630224 FW, 57692517, 24491787, 24491775, 24491790, fx 10060819, invs669671, D3575312001/7407

JASO IS A BUY, CNH ALSO

I made some moves today since I have been waiting for a breakout. I sold out my WHQ position to add to my money available to purchase JASO. JASO has put out a perfect cup with handle and should do better than WHQ. (After all, I did get a 7% return on WHQ in 2 weeks so why not take a profit and move to something else.) Click on the chart to see what I am talking about and notice that the buy point is $41.09 leaving a maximum buy point of $43.14. Have the expectation of JASO to bounce back and forth between $36.25 and $41.00 for a while since it needs to work past some previous resistance. A move past $44 should be big.






I want to point out that CNH is also in a buy territory, but I am not going to buy into it due to my rules of having only 5 stocks based upon my rules for the number of stocks to own. (Read the post from September 14th to see my rules.) Just click on the chart to see another cup with handle.

Good luck trading.
JD

THANK YOU, FED!!!

The markets took off after the Fed announced a 0.5% cut in the interest rate. Glad I am fully in the market.

Here is an update on one of my portfolios. Beginning June 1, 2007, the account had $20,000 in it. This is a retirement account and does not trade on margin. So the profit in this portfolio is dollar for dollar. Since 6/1/07, it has risen to $42,054 as seen by the graph. That is a 110% increase in almost four months. Of note, there have been no deposits into this account as it is a rollover IRA. As this portfolio grows, I will have it verified by an accountant.

As for now, BLUD is just past the buy zone, but it may bounce in and out of the area between $32 and $35.65. Remember, the maximum buy price is $35.61. Also remember, it takes weeks to make $$$.

All of the other stocks are over-extended and are not buy candidates.

Good luck trading.
JD

BLUD IS GETTING READY TO BREAK PAST 6 MONTHS RESISTANCE IN CUP WITH HANDLE

BLUD just broke out past a buy point of $33.92 on a cup with handle. Remember to buy within 5% of this so a maximum price to pay is $35.61. I am adding shares within this zone.

Overall, this past week has been productive in the portfolios I manage. I even went back into the August 24th blog to look at the graph I printed out to show progress since then. The high back on that date was $36,667 and if you look at this graph, the portfolio is up to $39,324. Which is another 7% rise in 3 weeks. The only two stocks in this portfolio are MR and WHQ.

Again, to see the stocks that I have in my portfolio, just look to the right and you will see them in the Yahoo! toolbar. Note, however, if they are in the portfolio, it doesn't mean that it is time to buy. Just look throughout the blog and you will see when I put out buy signals.

One topic I wish to discuss is how much to invest in stocks. Well, you can easily start out with any amount that you want. Just remember that with any trade there is a commission to trade. If you have only $200 and you trade once using a Scottrade account, you are down to $193 due to the $7 commission. So you are probably asking how much do I trade if I have more than that?

Here is how I break it down.
$0-$25,000 - one stock only
$25,000-$50,000 - two stocks
$50,000-$100,000 - three stocks
$100,000-$250,000 - four stocks
$250,000-$1 mil - five stocks
Well, as soon as I get above $1 million, I will reassess what I need to do.

Now why would I invest in only one stock up to $25,000? Many reasons:
1. I only have to follow one stock while I get used to learning how to trade.
2. I can make a lot more money on one stock that goes up 20% when I have $20k versus four stocks at $5K each that may not get me 20%.
3. I have less commisions trading one stock versus many.

Good luck trading.

JD

OMCL TO BE ADDED TO S&P 600 AND WHQ HITS BUY SIGNAL

OMCL took off today on news that it will be adde to the S&P SmallCap 600. Click on this link to read the article if so inclined. That meant good news for OMCL today and it jumped 7.7%. Throughout these past few weeks, I said that I had added about $100K between the price of $23.60 and $24. It is beginning to pay off. I am going to see what will happen to the stock in the next few weeks to see if I take my 20% off the table or if I get to hold onto it for 8 weeks.

WHQ became a buy today based upon one of my buying signals. It has traded sideways for a few months and is ripe for a breakout. Hopefully it will become a winner just like BCSI was for me. Expect a stronger move if the stock breaks out over $69.22. Click on the chart to enlarge it and see an upclose view.

Watch SMSI closely.

Disclaimer: I strongly recommend that you consult with a licensed financial professional or psychotherapist before committing yourself to the insane world of investing. Any market data or commentary used on this page is for illustrative and educational purpose as well as self-petting. Although this blog may provide information relating to investment ideas, visual stimulation or opportunities to buy or sell securities, you should not construe anything on this page as legal, tax, investment, financial or any other type of advice. If you do, it's your own damn fault and suck up the responsibilty for your own actions. Nothing contained on this page constitutes a solicitation, recommendation, promotion, endorsement, encouragement or offer to buy or sell any security or other toys that give you enjoyment.

AIRM LOOKS LIKE IT IS BLOSSOMING

I was just playing around this morning and looking at stocks that IBD says look good. One really caught my eye was AIRM. AIRM came down to touch the 50 day moving average (blue line) and has bounced off of it in higher-than-average trading volume. (You can enlarge the chart by clicking on it.) I snapped quite a few shares up today at $43.05 and am going to see if I can get into buying more.

Here is the "fundamental" logic behind buying AIRM. It was highlighted in the IBD timesaver table. SMR = 99, EPS = 93, RSI bounced off 50 and is moving higher, INDUSTRY GRP = A, SALES- PROFIT - ROE = B, A/D = A.

Good luck trading.

JD

MR breaks out!!!

Well, MR did it!!! It broke out of another resistance area and moved more than 5% today in higher-than-average trading volume. Be wary though. The maximum price to buy up to is $37.95 based upon the IBD rules for buying. How do I get this number? Remember, the proper buy point is $0.10 above the previous high and you can buy within 5% of this high. So here is the equation: Previous high = $36.05. Add $0.10 = $36.15. $36.15 multiplied by 5% = $37.95

OMCL may be on its way to breaking out. It is frustrating to be holding onto this one for 6 weeks with no movement, but patience is a virtue. Let's see what the future holds.

I actually sold BCSI today. Here is my reasoning. 1. It looked as if the stock was poised to take off from what is called a BULL FLAG. It started out the day strong, but as the day wore on, the stock continued to sell off in higher volume. So here is my tally.

Bought $53.1587

Sold $80.31

Profit $27.15/share or a % gain of 51%

Reason #2 to sell, I bought more MR shares today.

I revised the Yahoo! stock quote icon to the right to reflect my selling of BCSI by removing it from the graphic. You will note that the stocks that are quoted in the Yahoo! graphic will be the stocks that I am trading in my own personal portfolio.

Good luck trading.

JD

Disclaimer: I strongly recommend that you consult with a licensed financial professional or psychotherapist before committing yourself to the insane world of investing. Any market data or commentary used on this page is for illustrative and educational purpose as well as self-petting. Although this blog may provide information relating to investment ideas, visual stimulation or opportunities to buy or sell securities, you should not construe anything on this page as legal, tax, investment, financial or any other type of advice. If you do, it's your own damn fault and suck up the responsibilty for your own actions. Nothing contained on this page constitutes a solicitation, recommendation, promotion, endorsement, encouragement or offer to buy or sell any security or other toys that give you enjoyment.

SETTING UP A HEDGE FUND

I have researched setting up my own hedge fund and I may have found a way to get my idea started. My problem is that I am not a registered investment advisor nor a stock broker. I have been researching the idea of becoming one, but I don't know where to start.

Maybe my friend, Paul can help out since his neighbor used to work for Merrill Lynch. There is also a website that will sponsor and individual to get the Series 65, but again it is a fear of venturing into the unknown.

Here is a clip from a website (http://www.moneyscience.org/tiki/tiki-read_article.php?articleId=108#1) that explains how to set up an incubator hedge fund.

Incubator Hedge Funds
There is an alternative approach for hedge fund managers who want to test the waters before spending $15k or more to set up a hedge fund. Setting up an incubator hedge fund allows a hedge fund manager to develop a track record which will assist in attracting investors later in time.
An “incubator” can be created by breaking down the hedge fund development process into two stages and isolating the first.

Stage One. The first stage sets up the hedge fund and management company, and creates the required operating documents and resolutions. Completion of the first stage allows the hedge fund to begin trading and developing an auditable performance record. The incubator fund, in nearly all cases, is seeded with the fund manager's money. By trading under this structure, the hedge fund manager develops a track record, which, once audited by an accountant, can be marketed legally to potential investors through the offering documents which are developed in the second stage.

Stage Two. In the second stage, the offering documents are developed and an audit of the fund is completed by an accountant. The offering documents, with the financial statement of the hedge fund, is circulated to prospective investors.

Starting out with an incubator method affords the opportunity for those with a skill for trading (often in their personal accounts) to break down the hedge fund development process into a cost manageable undertaking. One of the caveats of the incubator approach to launching a hedge fund is that the aspiring fund manager is not paid for trading his own money. The acceptance of third party money (and whether this is permitted depends on the state or country where hedge fund management is based), creates a fiduciary obligation and risk for which the hedge fund manager is not paid. Acceptance of third party money into an incubator fund, in the rare case when allowable, is not recommended, given the legal exposure it creates for the hedge fund manager.

The biggest issues one needs to deal with is getting a prime broker, a securities attorney, and and auditor.

As I read, here is the reason for becoming a hedge fund manager:
http://www.nytimes.com/2007/04/24/business/24hedge.html?ei=5088&en=22f49c09d1ef88eb&ex=1335067200

It is nice to have aspirations so let's see what the future holds.

JD

EPS ANNOUNCEMENT TRADING PLAN

Don't get me wrong. I love my current trading plan, but it is tough to sit on the sidelines and wait for some stocks to make a move. Take, for example, OMCL. I have been waiting for 4 weeks for this stock to make a move.

So I have tried a scenario and I am going to use code for myself. Why?? Well, what if I want to make it a proprietary system and open up a hedge fund to trade it this way? I don't want anyone else knowing how I do it, but I will at least give you the results and show my trading progress.

Here are my rules:

5 min chart. Last 15 mins price and volume.

Buy if up
Short if down

Here are some stocks that I have traded and the result:

MENT
Bought 8/23 @ $12.50
Sold 8/28 @ $14.0325
Profit = $1.5325/share
Percent gain/loss = 10.9%

GEF
Bought 8/29 @ $58.80
Sold 8/31 @ $57.85
Profit = ($0.95/share)
Percent gain/loss = (1.6%)

OVTI
Bought 8/30 @ $19.88
Sold 8/31 @ $20.7825
Profit = $0.9025/share
Percent gain/loss = 4.5%