WEEKLY and DAILY STOCHASTICS

Here is an interesting chart that I am looking at. It is on XGLD, but if you want to use the ETF GLD, it could still be put into use. What I noticed on this chart is the overlay of the weekly and daily Irwin Cycle Stochastic. Since this stock is in a downtrend, I noticed it was useful to short when both the weekly and daily stochastics were above 80. It looks as if 3 out of the 4 trades would have panned out as winners.

One other thing is that if you use a 50 day EMA as the trend indicator and sell when the weekly Irwin Cycle Stochastic takes a down turn after being above 80.

My problem is that I cannot find out about this Irwin Cycle Stochastic on the internet as of yet. There is really no good description on it so I have taken Full Stochastics and used these parameters: Shorter time frame is (14,3,3) and the longer time frame is (60,15,15). The buy area is best when both indicators are below 20 and the best shorting opportunity is when both are above 80. If you want to take short term trades, buy when long term %K is above %D and short term %K crosses above %D. Short when long term %K is lower than %D and short term %K crosses below %D. It doesn't look like it does well on indices. I just need to backtest the system to see how it does.

JD

GXDX and LMNX

What is up with the X's?




Anyway... GXDX has not panned out yet so now is the time to sell a covered call/buy a put/sell a bear call spread. If you understand those statements, kudos to you. So, the logic goes is that since the ADX is below 25, the stock is non-trending. The slow stochastic is now in OVERBOUGHT territory. If the stock breaks back down below the 200 day moving average, perform those trades.



So as for LMNX - if the stock breaks above $22, buy the stock or sell bull put spread. Why would I buy at $22 and not now? Well the stock is not trending as noted by the ADX being below 25 and the Slow Stochastics is in OVERSOLD territory.

Good luck trading.
JD

TRADE SET UP

Here is a stock that I have held for quite a while and am going to add more shares. GXDX has been trading sideways for about a year trading between $20 and $40. Yeah, that is a 100% range but this stock has held out despite the overall 40% decline in the stock market.

Here is my logic:

1. The ADX is below 25 which denotes a non-trending stock.

2. The slow stochastic (14,3) has just crossed 20 which is a buy signal in an non-trending stock.

3. $28 has acted as support for the past 3 months.

4. The 200 day moving average is still being used as support.

My target to sell is $38 and my stop loss is below $28.

Let's see how this one pans out.

BEST OPTION PLAYS FOR CURRENCIES

ETFs used to match forex pairs:
FXA
FXB
FXC
FXF
FXM
FXS
USD index. If you want to USD to rise, buy the UUP which stands for USD UP. If you want to dollar to decline, BUY the UDN which stands for USD DowN.
DBV

Other ETFs
QID - the inverse fund of the Nasdaq.
SH, SDS - inverse of the SP-500.
DOG, DXD - inverse of the DJ-30.
TWM - 2x inverse of the Russell 2000.
MYY, MVV - inverse of the MidCap 400.
INP - India
FXI - ChinaEWZ - Brazil
EWM - Malaysia
EWW - Mexico
EWT - Taiwan
ILF - Latin American
FXP - Ultra short China
EEV - Ultra short Emerging Markets
EWV - Ultrashort Japan
GLD - Gold
OIL - Oil
SLV - Silver
XHB - Homebuilder ETF

Check out this website:
http://www.futuresmag.com/NR/rdonlyres/D7445BBE-7872-44C3-B52E-3D5988AE2DE6/389189/ETFGuideMAR093.pdf


ETF Name Ticker Symbol
SPY
QQQQ
DIA
Retail HOLDRs RTH 6,221
Ultra QQQ ProShares QLD 5,802
Industrial Select Sector SPDR XLI 5,749
Consumer Discretionary SPDR XLY 4,093
iShares Russell 1000 Growth Index IWF 3,815
Consumer Staples Select Sector SPDR XLP 3,281
iShares S&P 500 Index IVV 2,981
Ultra S&P500 ProShares SSO 2,666
iShares Russell 1000 Value Index IWD 2,557
iShares S&P 100 Index OEF 1,980
iShares Russell 1000 Index IWB 1,280
iShares Dow Jones Select Dividend Index DVY 969
Rydex S&P Equal Weight RSP 841
Ultra Dow30 ProShares DDM 698
Vanguard Total Stock Market ETF VTI 517
iShares Russell 3000 Index IWV 508
iShares Dow Jones US Home Construction ITB 478
Vanguard Growth ETF VUG 390
PowerShares Dynamic Large Cap Growth PWB 359
Vanguard Value ETF VTV 273
PowerShares FTSE RAFI US 1000 PRF 220
Vanguard Large Cap ETF VV 204
PowerShares Aerospace & Defense PPA 200
Internet HOLDRs HHH 183
iShares Russell 3000 Growth Index IWZ 136
iShares Dow Jones US Consumer Services IYC 101
iShares Russell 3000 Value Index IWW 93
PowerShares Dynamic Large Cap Value PWV 93
iShares Dow Jones US Index IYY 75
iShares Dow Jones US Industrial IYJ 67
PowerShares Dynamic Market PWC 63
Vanguard Consumer Staples ETF VDC 63
Rydex Russell Top 50 XLG 57
Vanguard Consumer Discretionary ETF VCR 54
Mid Cap Equity Index ETFs
Daily Volume
ETF Name Ticker Symbol (in 000s)
MidCap SPDRs MDY 5,966
SPDR S&P Homebuilders XHB 4,823
SPDR S&P Retail XRT 3,718
iShares Dow Jones Transportation Average IYT 869
iShares Russell Midcap Growth Index IWP 549
iShares Russell Midcap Value Index IWS 539
iShares S&P MidCap 400 Index IJH 531
iShares Russell Midcap Index IWR 334
PowerShares Dynamic Mid Cap Growth PWJ 229
Vanguard Mid Cap ETF VO 173
PowerShares Value Line Timeliness Select PIV 116
Ultra MidCap400 ProShares MVV 107
Vanguard Extended Market Index ETF VXF 76
PowerShares Listed Private Equity PSP 69
Vanguard Mid-Cap Value ETF VOE 65
Vanguard Mid-Cap Growth ETF VOT 56
Small Cap Equity Index ETFs
Daily Volume
ETF Name Ticker Symbol (in 000s)
iShares Russell 2000 Index IWM 97,988
iShares Russell 2000 Growth Index IWO 4,780
iShares Russell 2000 Value Index IWN 3,354
iShares S&P SmallCap 600 Index IJR 2,025
Ultra Russell2000 ProShares UWM 539
Vanguard Small Cap Value ETF VBR 191
Vanguard Small Cap ETF VB 190
iShares Russell Microcap Index IWC 174
Vanguard Small Cap Growth ETF VBK 158
PowerShares Zacks Micro Cap PZI 94
PowerShares Cleantech PZD 64
PowerShares Dynamic Small Cap Value PWY 61
Equity Sector ETFs
Daily Volume
ETF Name Ticker Symbol (in 000s)
Financial Select Sector SPDR XLF 97,439
Semiconductor HOLDRs SMH 10,285
iShares Dow Jones US Real Estate IYR 7,672
Utilities Select Sector SPDR XLU 5,725
Technology Select Sector SPDR XLK 4,002
Health Care Select Sector SPDR XLV 2,747
iShares Dow Jones US Broker-Dealers IAI 1,429
iShares Nasdaq Biotechnology IBB 1,390
iShares Cohen & Steers Realty Majors ICF 1,216
Regional Bank HOLDRs RKH 1,037
KBW Capital Markets ETF KCE 969
Pharmaceutical HOLDRs PPH 846
iShares Dow Jones US Financial Sector IYF 652
iShares Dow Jones US Telecom IYZ 499
Vanguard REIT Index ETF VNQ 445
iShares Dow Jones US Financial Services IYG 295
Software HOLDRs SWH 270
DJ Wilshire REIT ETF RWR 257
iShares Dow Jones US Technology IYW 254
SPDR DJ Wilshire Intl Real Estate RWX 235
iShares S&P GSTI Semiconductor IGW 219
Biotech HOLDRs BBH 217
Futures’ 2008 ETF Guide
These are U.S.-listed ETFs that traded more than 50,000 units a day, on average, the last three months of 2007 and also have a futures or options
contract based upon them. They are broken down by category and ranked by volume. For a fuller version of the table, visit www.futuresmag.com.
68 FUTURES March 2008
ETF Guide continued
Reproduction or use of the text or pictorial content in any manner without written permission is prohibited.
Copyright 2008 by Futures Magazine Group, 222 S. Riverside Plaza, Suite 620, Chicago, IL 60606
www.futuresmag.com March 2008 69
iShares S&P GSTI Software IGV 217
iShares S&P GSTI Technology IGM 191
iShares S&P GSTI Networking IGN 184
SPDR S&P Biotech XBI 165
PowerShares Dynamic Semiconductors PSI 163
Vanguard Financials ETF VFH 159
Telecom HOLDRs TTH 118
Vanguard Information Technology ETF VGT 103
iShares Dow Jones US Utilities IDU 91
iShares S&P Global Healthcare IXJ 82
Utilities HOLDRs UTH 79
iShares Dow Jones US Healthcare IYH 75
SPDR S&P Semiconductor XSD 70
iShares S&P Global Telecommunications IXP 62
iShares S&P Global Technology IXN 62
Vanguard Health Care ETF VHT 52
First Trust Dow Jones Internet Index FDN 50
Fixed-income ETFs
Daily Volume
ETF Name Ticker Symbol (in 000s)
iShares Lehman 20+ Year Treasury Bond TLT 1,774
iShares Lehman 1-3 Year Treasury Bond SHY 876
iShares Lehman 7-10 Year Treasury IEF 314
iShares Lehman TIPS Bond TIP 294
Vanguard Total Bond Market ETF BND 213
iShares iBoxx $ Invest Grade Corp Bond LQD 152
SPDR Lehman 1-3 Month T-Bill BIL 136
SPDR Lehman Municipal Bond TFI 62
Currency ETFs
Daily Volume
ETF Name Ticker Symbol (in 000s)
CurrencyShares Japanese Yen Trust FXY 322
CurrencyShares Euro Trust FXE 195
PowerShares DB G10 Currency Harvest DBV 183
Commodity-linked ETFs
Daily Volume
ETF Name Ticker Symbol (in 000s)
Energy Select Sector SPDR XLE 22,532
Materials Select Sector SPDR XLB 10,872
United States Oil USO 3,501
Market Vectors Gold Miners ETF GDX 2,541
United States Natural Gas UNG 1,272
PowerShares WilderHill Clean Energy PBW 1,241
PowerShares DB Agriculture DBA 878
SPDR S&P Metals & Mining XME 622
PowerShares Water Resources PHO 562
PowerShares DB Commodity Idx Trking Fund DBC 506
SPDR S&P Oil & Gas Exploration & Prod XOP 250
iShares Dow Jones US Basic Materials IYM 249
PowerShares Dynamic Oil & Gas Services PXJ 228
iShares Dow Jones US Energy IYE 203
Market Vectors Steel ETF SLX 171
iShares S&P GSCI Commodity-Indexed Trust GSG 133
Claymore S&P Global Water CGW 105
SPDR S&P Oil & Gas Equipment & Services XES 76
Ultra Oil & Gas ProShares DIG 69
PowerShares DB Base Metals DBB 54
iShares S&P Global Energy IXC 54
PowerShares Dynamic Energy Explor & Prod PXE 52
Bear Market ETFs
Daily Volume
ETF Name Ticker Symbol (in 000s)
UltraShort QQQ ProShares QID 32,147
UltraShort S&P500 ProShares SDS 19,607
UltraShort Russell2000 ProShares TWM 6,114
UltraShort Dow30 ProShares DXD 3,633
UltraShort Financials ProShares SKF 2,645
UltraShort FTSE/Xinhua China 25 Proshare FXP 1,585
UltraShort Oil & Gas ProShares DUG 1,177
UltraShort Real Estate ProShares SRS 1,061
UltraShort MidCap400 ProShares MZZ 939
UltraShort MSCI Emerging Mrkts ProShares EEV 368
Short S&P500 ProShares SH 256
Short Dow30 ProShares DOG 246
International and Emerging Market ETFs
Daily Volume
ETF Name Ticker Symbol (in 000s)
iShares MSCI Emerging Markets Index EEM 20,400
iShares MSCI Japan Index EWJ 19,548
iShares MSCI Brazil Index EWZ 15,293
iShares MSCI EAFE Index EFA 11,615
iShares MSCI Taiwan Index EWT 8,563
iShares MSCI Hong Kong Index EWH 8,014
iShares FTSE/Xinhua China 25 Index FXI 6,880
iShares MSCI Mexico Index EWW 3,959
iShares MSCI Malaysia Index EWM 3,548
iShares MSCI South Korea Index EWY 2,912
iShares MSCI Australia Index EWA 2,449
iShares MSCI Germany Index EWG 1,613
iShares MSCI Canada Index EWC 1,489
PowerShares Gldn Dragon Halter USX China PGJ 1,463
Vanguard Emerging Markets Stock ETF VWO 856
Claymore/BNY BRIC EEB 731
Market Vectors Global Agribusiness ETF MOO 569
iShares S&P Latin America 40 Index ILF 504
iShares S&P Europe 350 Index IEV 421
Vanguard European Stock ETF VGK 419
iShares MSCI Spain Index EWP 393
Vanguard Europe Pacific ETF VEA 347
iShares MSCI Sweden Index EWD 345
Vanguard FTSE All-World ex-US ETF VEU 309
PowerShares Intl Dividend Achievers PID 299
SPDR S&P BRIC 40 BIK 271
iShares MSCI South Africa Index EZA 253
SPDR S&P China GXC 224
DJ Euro STOXX 50 ETF FEZ 214
Vanguard Pacific Stock ETF VPL 167
iShares S&P Global 100 Index IOO 157

SELF-DIRECTED IRA

Funding a Real Estate Mortgage Case Study (copied from www.theentrustgroup.com website)

Northern Colorado Real Estate Investors GroupContact: Paul--Mammoth Property Management, Inc.Telephone: (970) 419-8245When: Last Monday of every month, 6:30pmWhere: Downtown Public Library, 201 Peterson St., Fort Collins

Northern Front Range Investors AssociationContact: Michele LarsonTelephone: (970) 214-3627When: 4th Thursday of each month, doors open at 6:30pm fornetworking, meeting at 7:00pmWhere: Windsor Rec Center, Windsor

Buying and selling real estate is certainly one potentially profitable way to invest the funds in a self-directed IRA, but it is not the only real estate-related investment strategy.
Our story begins with a real estate broker, Jack, who was working with a client to try to sell a $200,000 property. The property had been on the market for about one year. Jack had found a potential buyer, Emma, who placed the property under contract. Emma had lined up a loan for $160,000, but still needed $15,000 to fund the purchase. Her lender was not willing to increase the amount of the loan since Emma had not worked during the past two years. Jack was concerned that the deal was going to fall through.
Byron, also a broker, was an acquaintance of Jack’s. Jack was aware that Byron was interested in sound opportunities to loan money to fellow brokers’ clients. Byron had a self-directed Entrust SEP-IRA with a balance, at that point, of roughly $250,000. Jack brought Byron and Emma together, and Byron agreed to have his self-directed IRA lend her money. He was able to negotiate the terms of the loan directly with Emma, however the actual lender documents could only be signed by his IRA administrator on Byron’s behalf.
Byron offered Emma two loan options. One, a first mortgage on the property for $175,000, with a 30-year amortization, at a fixed rate of 7.825%. This was just a little higher than the bank’s current rate. The deal included a 1-point fee for the loan.
Alternatively, Byron was willing to complement the bank’s loan, if that is what Emma preferred. This meant lending her $16,000 for a second mortgage, with interest-only payments for three years. At the end of three years the loan principal would be due. Byron set the interest rate at 8%, with a $500 fee.
Keep in mind that Byron alone assessed the relative risk in making these loans. He also set the terms of the loans. He was well aware that his IRA administrator could not advise him on these matters.
Uncomfortable with balloon payments, Emma decided on Byron’s first option for $175,000. She negotiated with Byron to increase the loan slightly to cover the cost of the 1-point fee. Ultimately, Byron reduced the fee to ¾ point, and set the amount of the loan at $178,000.
With the parties agreed on the terms, Byron called his title company to have them prepare the loan documents, carefully instructing them that the lender was his SEP-IRA (Entrust, FBO Byron IRA.) He then contacted his local Entrust office to provide them instructions for funding the closing. He had them make sure that all matters regarding the loan were carefully finalized. This included making sure the loan was properly recorded, that the trust deed secured the note with the property, that insurance on the property was in place, and that Entrust FBO Byron IRA was listed as loss payee for up to the amount of the loan. His Entrust office then sent a wire transfer from Byron’s IRA for $176,665 to closing ($178,000 less the $1,335 fee).
Meanwhile, Emma had found a job, and was doing well. She proved completely reliable, consistently making her required payments. Per instructions, she made these payable to "Entrust, FBO Byron IRA," but she mailed them directly to Byron. Byron tracked the payments, properly noting both the interest and principal amounts, prior to forwarding Emma’s check to Entrust.
Byron did have the option of hiring a loan servicing company to handle the payments. The servicing company would have kept all the details for the loan, and handled reporting to the borrower. The loan servicing company would forward the payments to the IRA once recorded.Emma’s credit rating had improved so after six months Bryon decided to sell the note to another lender, whom we will call Plancomp, Inc. Plancomp evaluated the loan, which then had a balance of $177,245 and determined that the market rate for the loan was about 6 ¾. They agreed to buy the note at an interest rate of 7.125%.
Since the note was already paying interest at 7.825%, as Emma and Byron had initially agreed, the value of the note—$189,722—was more than its balance. The note purchaser sent a check to Entrust FBO Byron IRA, who then, at Byron’s instruction, assigned the note to Plancomp, and Plancomp promptly took over servicing the loan
Let’s review the outcome. Byron’s IRA invested $176,665, and received back $189,722 plus six monthly payments totaling $7,706, less expenses of $295 paid to Entrust for their administration services. This is a net gain of $20,469, or more than 11%, in six months.
Byron now has about $270,000 in his SEP-IRA and is only too happy to remind brokers to come to him if they have clients having trouble getting a loan.

ADX crosses

BUY - FHA @ 11.35

SHORT these stocks:
SNDK
EK - @ $13
D - @ $38.50
CME @ $330

Short ADLR, AFP

WHAT TO DO? WHAT TO DO?

LONG - MGRC, RWT

SHORT - UHAL, SAP, MNST

Awaiting our Government's Downfall

Long: CME @ $388. PHHM at $10.60
SWS is lokking good
DNDN is using 200 day EMA as support.
FSYS using 200 day EMA as support.
NTRI popped above its 200 day EMA and is now using it as support. Possibly go long.
Watch RF very closely.
TSO, VLO are consolidating.

200 day EMA is acting as resistance for GLD. Where will this one go?

SHORT - RYAAY, SPSS at $34, CBG at $15

Long CVA, SAP, TIN, BNI. Short GRMN

Long EME, CNQR, Short BRCM @ $25.25

BOUGHT MASI AT $35.85

Also, being patient on shorting VIVO and CRZO have been fruitful in the past few days.

What's happening to CNMD? I believe there is a lot of "short covering". Today's movement is not that promising, but if it can back off down to its 20 day EMA at $26.85, this may be another buying opportunity as the trend for the past few months has been slightly upward.

BUYING MASI BASED UPON DMI X-OVER

MASI finally broke out after a long consolidation period. Wanting to buy near $36.

SHORTING THE MARKET

Here is an interesting way to "short" the market by BUYING reverse ETFs. If the market goes down, these go up. Thus they are called REVERSE ETFs. Here is the link:

http://www.proshares.com/funds?products=98616&fundType=

you may need to keep the = sign on the end if the links doesn't work.

WHERE ARE WE GONNA GO?

The market has decided to pierce previous support and look to move downward over the past couple of days.  Where we go from here, no one knows.  If you look at the DJIA on a weekly chart you will see that we are in a downtrend after hitting the 200 day moving average (it acted as resistance)  and falling to our present position.  It has broken down further past the March lows so it would portend a fall.  Looking at the stochastics on a weekly DJIA chart shows that it is nearing an oversold area so a small bounce may be in order.  Don't you just love all the reasons I can come up with to try and "predict the market."  I still do not believe anyone can, but I am trying to predict near term moves by looking at charts.  

GXDX recently popped up and is retracing again to a buy point and do I ever hate buying when the market is going down.  Based upon on of my screens, however, GXDX has shown a buy signal and I made mention that a good buying point was below $31.  Well, I bought more shares today at $30.38 after the stock bounced of its 20 day EMA and after the ADX showed a buy signal about 2 weeks ago and 6 weeks ago.  

Shorting VIVO was a good thing.  Still waiting for CRZO to drop buy oil prices keep holding steady. 

Let's see where we go from here.

Good luck trading.

JD

NAVG LOOKS GREAT ON P AND F AS WELL AS A DAILY CHART

NAVG looks good on a P and F chart as it has broken a downtrend and is now consolidating. If you look at a daily chart like the one here, you will see there is a strong rise in the ADX after dipping to 10 in mid-June. As the ADX gets to that low, there should be a strong movement one way or the other and it has chosen up. Now, the 200 day MA may pose a threat to this recent rise as it met resistance today. I would love to add shares when it retreated back down to $52.50 to $53.50.

GXDX has done the same thing and right now it may be a little overexteded. So wait for this one to pull back into the $29 to $31 range.

WYE HITS BUY SIGNAL ON WEEKLY CHART

WYE has crossed the ADX system that I like to trade meaning this is a long term trade (1 year) since the cross occurred on a WEEKLY chart and not on a daily chart. I have added a few shares onto my account and will buy on dips (anywhere from $46.25 to $47).

I also bought the puts on VIVO.

LOOKING AT A NEW MONEY MGMT SYSTEM, BUYING PUTS TOO

The overall market continues to decline and I will ride the stocks that continue to make lower highs and sell those rallies (or buy puts).

OXPS - on a weekly chart, the slow stochastics (14,3) are in overbought territory and the ADX is below 25 meaning that the stock is not trending. On a daily chart (seen on this blog), it has had a small uptrend for the past few months, but the stochastics are also heading lower while the ADX is at 15. Note that the ADX did not rise above 25 during this recent uptrend and if a stock trends up strongly, so should the ADX. Since both stochastics on a weekly and on a daily chart coincide, I suspect that the stock is going to head lower for a little while, but this is debatable.

CRZO - Here is one that I see on a daily chart that is probably going to drop a little while. The weekly chart shows a strong uptrend during the past few months, but the ADX is showing negative divergence - i.e. the stock has moved higher, but the ADX is now trending downward. On the daily chart, the ADX is less than 25 denoting a non-trending stock and the slow stochastics have just broken down below the overbought area. Perfect opportunity per stochastic recommendations.

Another one I like on the short side is VIVO. It has had a long uptrend also on a weekly chart but in mid-April, the uptrend was broken with high trading volume. Since that time, the stock has risen, but trading volume never surpassed the high selling volume. Focusing back down onto a daily chart shows the stock hitting the 200 day moving average and it is resistance. I see this as another perfect time to short the stock or buy puts.

Good luck trading.

JD

THANK YOU ESLR!!! WATCH UGI

I am watching UGI since the weekly ADX is getting ready to cross as a buy signal and the daily ADX has just created a buy signal by crossing the 20 line. The stock also broke out of consolidation that has lasted for 2 years. I am putting a buy order in near $27.75.

ESLR - SharpCharts from StockCharts.com

ESLR - SharpCharts from StockCharts.com: "ESLR" Check out this chart in that the Stochastic is turning positive in a non-trending stock. That would make this much more of a buying opportunity.

LONG GSX, FLEX, AMZN, AMD

LONG AMLN, POSSIBLE REBUY ON STAR, SHORT NTAP AND GNK

Long STAR

WATCH VIV, ASF, CCRT

VIV is near its 50 day EMA.  The buying volume has outweighed the selling volume and a stock near its 50 day EMA is a buying opportunity.

The same exact scenario is with ASF and CCRT.

Missed out on BCE's down move, but got in on PENN at $44.61.

Good luck trading.

JD

SHORT BCE; LONG PENN

QID IS LURKING NEAR ITS 200 DAY EMA

QID was helpful to me by helping to keep my portfolio from imploding.  I enjoy reverse ETFs since a trader can trade them in their retirement account and they move in the opposite direction as the major indices such as the QQQQ, DJIA, SPY, etc.  Since QID is near its 200 day EMA, a trader has a very important decision to make.  Do I take the QID side or do I take the QQQQ side?  i.e. do I think the market is going to drop or is it going to rise?  

I have been taking some real short trades and trying to garner only 5% profit moves.  I recently was successful on FSLR.  The reason I bought it was the MACD had crossed the Zero line near $215.  My purchase point was $216.77.  I hit my price target of $227 in three days of trading.  I'll take 5% in 3 days anytime.  

I had also been watching CPST.  On 2/25, CPST broke out of a cup-with-handle and I made an initial buy at $1.88.   I have patiently waited a month and I decided to buy more when the stock retraced back down to $1.82.  I have a nice profit so far and I intend to ride it a little longer and take my first profits at $2.30 then wait for a further exit.

Watch FXC very closely as it is sitting on its 200 day EMA for the past 4 days.  I believe it will be a buying opportunity, but there is currently a fight between the falling USD and falling commodity prices.  Commodity prices and the CAD are best followed by comparing them to the $CRX (type that into the symbol section at www.stockcharts.com to see the chart.)  So if you look at both the FXC and the $CRX, you will see that both have bounced off the 200 day EMA recently.  Let's see if it holds.

Good luck trading.

JD

QID IS HELPING ME OUT.

Thank heaven for reverse ETFs. If it weren't for QID, my account would be suckin'.

I do have to mention something, though. I have been keeping my eye on ENDP and I am going to buy in near $27. Call me crazy about buying something in a downtrending market. In my rules I have written to not do what I am doing, but my emotions may be clouding my better judgment.

THIS SMALL RALLY MAY BE TAKING A DIGGER

I am watching this whole market probably taking a digger after trying to rally. That being said, I have been wrong. This rally has tried to pick up some steam, but I am just not as confident as before.

I am going to short the market by buying the QID. What? How can you short the market by buying stock? Well, in all actuality, QID is the reverse of the market. Since I believe the market is going to go down, this exchange traded fund (QID) will go up. The QQQQ is below its 50 day moving average and trading volume is not as strong as selling volume. My personal belief is that the market is creating a Bear Flag. Google that and you will find out what that is.

So I am going to protect my portfolio by selling some stocks during this rally and buying QID.

Good luck trading.

JD

BUYERS CONTINUE TO SHOW THEMSELVES. PATIENCE IS A VIRTUE

So I am looking at buying in on STJ due to a bullish MACD crossover.  

I am going to be watching WM to add more shares in the drawback in low trading volume after a breakout.  Targeting the $15 range which is near the 50 day moving average.

CG is gone.

GOOD LUCK TRADING.

JD

NEW BUYS POPPING UP AFTER THIS BOUNCE UP

Buys today include AMAT, SYMC and XLNX. If you didn't get in on BOBE, it is sitting around another buying opportunity.

Waiting for CF to take a digger as it is a stock to "short."

Good luck trading.
JD

YUP! LOOKS LIKE ITS GONNA HOLD

APOL and BOBE are buys.

CF looks like a sell/short opportunity.

Good luck trading.
JD

NICE BOUNCE TODAY AND I THINK THIS ONE WILL HOLD

Look at ADLR. It has bucked the downtrend of the overall market at the MACD has just crossed the zero line.

What about CCC, too. It has just bounced off its 50 day moving average, still above its 200 day moving average and didn't sell off. What more could you want?

Large fund companies are also snapping up financial shares. Check out WM, FBP, FIF, JPM, MER. Home builders are also being bought. Check out PHM, RYL, HOV.

GOOD LUCK BUYING.
JD

For those who day trade: GAP OPEN STRATEGY

The Gap-Open Stock Trading Strategy

What is a Gap Open?
A gap open is when the opening price of a stock is above (gap up) or below (gap down) the previous evening's closing price.

Gap Up at the Open Trading Strategy

Like any system, method, tactic or strategy, its not 100% reliable, but applying the following criteria significantly reduces the risk of playing gap opens.

Ideally, the stock should gap above the previous day's high. It is better if it has gapped 5% one direction or the other. The stock should be a relatively strong stock that is in an up trend and/or rebounding off significant price support or a major moving average (like the 50-DMA or the 200-DMA).

Once the stock has gapped open to the upside in the morning, short the stock down to the previous days' close. You can then set your stop loss above the opening price. If the stock tumbles, the ideal situation occurs when the break above the 1st half-hour's high happens several hours after the 1st half-hour of trading (mid to latter day). The opposite is true when the stock gaps down. You would BUY the stock and close out the position when it reaches the previous days' closing price and set the stop loss below the low of the gap-down price.

Even better, should the "gap open" take the stock from below to above a significant moving average like the 50-DMA or 200-DMA, consider it a very bullish sign and therefore an extremely compelling play.


Here's another link: http://www.tradingday.com/c/tatuto/morninggapstrategies.html

GOOD LUCK TRADING.
JD

STILL HOLDING NEAR SUPPORT, BUT IT MAY BE WEAKENING

The market is most likely in a bear phase and there is going to be nothing but downward movement.  Even though the $125 mark on the DIA has held, there is more selling than buying.  So the little bounce I expected may not materialize.  

I have taken a bearish stance on some stocks.  ARO is one that I am taking a bearish tone.  In my personal account, I have created a calendar put spread.  What I am expecting is that the stock will drop over the next year since it is a retail stock.  I bought a Jan 2009 $25 put and sold a Feb 2008 $25 put.  The total cost to me was $3.00 per contract since I put in a limit order.  My intent is to recoup the $3 within the next 4 months and begin making a profit for the next 8 months.  I can best achieve this by buying back the Feb 2008 $25 put when the MACDH nears 0.25.  I would then wait a while and then move to the next month expiration and sell the March 2008 $25 when the MACDH nears -0.25.  It is even better to look for swing signals when the MACDH nears these values.  

That last paragraph may be totally confusing to someone who is not into technical analysis, but hopefully someone can figure it out.

So as for now, I am very bearish on the market and for the year, I am expecting it to be in the crapper.  That said, I hate trying to predict the market.

GOOD LUCK NOT TRADING.

JD

I AM EXPECTING A SMALL BOUNCE

I see the market using $125 on the DIA as support.  How long it will last is still questionable, but the $125 mark has been support twice in the past year.  Here is an option play that I am doing.  Buying the March 125 calls and setting a price target of $134.  If you look at the delta of the option, it is $0.61.  This means for every dollar rise in the stock, the option  rises 61 cents.  

Despite all that, some "defensive" stocks are peaking their heads out.  The pharmaceutical ETF has shown signs of life as well as AGN.  You will see that this one is in the banner to the right as a buy.  

CG has also made a nice bounce and I am putting in a buy for that one.  

I have shorted quite a few stocks and HB is one of them.  

GOOD LUCK TRADING.  (I still think this is a bear market so trade carefully)

JD

MARKET BACK INTO CORRECTION

I have to admit, I have not been doing too hot lately on hitting the stocks. Oh, Yeah. It's the market. Despite my best attempts, I still cannot predict the market 100%.

In light of that, AAPL, AMZN, LIFC, ININ have all hit the crapper. There are those that are still hanging on, but I don't know for how long so I am protecting my portfolio by getting 60% into cash. Yes, I am still hanging on to a few stocks, but I am going to protect them with covered calls. I am slapping covered calls on HITT, AMZN, WFT,

In some accounts, a trader has the capability of selling a covered call (click on this link to learn more about covered calls). I use them when a stock has made a nice run and I expect the stock to stay neutral meaning I don't see much upside or downside movement. I will gain a lot of money if the stock trades in this neutral fashion. WHY? Well, a covered call loses value over time. WAIT, if a covered call loses value over time, how does that make me money? Simple math, two negatives make a positive right? I SOLD a covered call and the covered call will LOSE VALUE over time. Those two negatives make me positive money. It takes a little getting used to to realize that you can make money if a stock stays neutral so click on this link for covered call strategies.

So needless to say, I am mostly in cash and covering my butt with covered calls.

GOOD LUCK NOT TRADING.
JD

LOGI gives me 5% in 25 days

LOGI triggered my MH system on Dec. 4th with a buy price of $34.84 and my target was $36.58. It took a while to gain that 5%, but I did it in less than a month.

CRZO has slid sideways during the downturn in late December. Now that the price of oil per barrel is back on the rise, so is CRZO. Remember, the target is just over $61.00.

ATW is still too pretty to let go. Still have not found a resistance point yet.

Today, I added a couple of stocks that hit my "A system." Those are HITT and AMZN. The trigger for HITT was actually triggered on Dec. 26th and I see the stock creating a bull flag and potentially creating a handle in a cup-with-handle formation.

AMZN to passed a resistance point near $95 in strong volume yesterday (Jan. 2, 2008) and bucked the downtrend in the general market. Got in today at$94.82. This one triggered my MH system and so I am setting a 5% profit target.

GOOD LUCK TRADING.
JD