Stocks for Monday: CTRP, PEGA, ARO, ABAX

Click on the chart to enlarge it

I am watching CTRP for a quick move. My entry is $60.04. Stock in a strong uptrend, recent retracement. Look at the chart and you will see I drew some trendlines on it to show why I am entering. Stop loss is $57.01 and target is $63.69 (a 6% move).

I am interested in PEGA in the fact that it appears to be sitting on a trendline near $32. A good entry would be the range of the previous pivot on 10/2/2009 from the range of $30.38 to $32.11. That's a wide range, but still a good entry area.

ARO also continues in an uptrend and is sitting on the 50 day EMA. It has popped out of a triangle and so my entry is $41.21. Setting a target of $45.48 with a stop loss at $39.16.
ABAX gained support at a gap. I think this will lead to better prices so I am going to set my entry near the bottom of the triangle. Entry is $25.47 with a target of $29.33 and a stop loss at $23.66.

FOREX FOR 10.23.2009

Crude Oil 81.35

+0.16 +0.20

Gold 1060.60

-0.48 -0.05%

CRB Index 282.54

0.00 0.00%

US Dollar 75.279

+0.185 +0.24%

So oil is still sitting above $80. With this rise one is looking for a rise in the CAD and GBP. However, gold is down slightly which will back the CAD back down and slow the rise of the AUD. As of 0600 MST, the USD is up.


Only a couple of dings for the USD today. So until 0800 MST does one stay away from the USD.

6:30am	USD		Fed Chairman Bernanke Speaks
8:00am	USD		Existing Home Sales			5.37M	5.10M

I am keeping a close eye on the GBPUSD as the British economy shrank for a record 6th straight quarter. If you look at the GBPUSD daily chart, one can see that the channel to the downside created over the last three months may be re-entered. If this is so, expect more downside as the USD is expected to climb this week as there is an expected 3.1% growth in the US GDP.

FOREX FOR 10.22.2009

Oil and gold are down as of 0800 EST. USD is up. This means to watch the GBPUSD, AUDUSD and EURUSD to head down.

Crude Oil 80.82

-0.55 -0.68

Gold 1057.12

-0.92 -0.09%

CRB Index 284.09 0.00 0.00%

US Dollar 75.254

+0.282 +0.36%

Expect some changes in the CAD today. Lots of news coming out so stay out of USDCAD.

6:30am	CAD		Core Retail Sales m/m			0.5%	-0.8%
6:30am	CAD		Retail Sales m/m			0.3%	-0.6%
6:30am	USD		Unemployment Claims			516K	514K
7:00am	EUR		Belgium NBB Business Climate			-15.6	-17.8
8:30am	CAD		BOC Monetary Policy Report

FOREX STATS FOR 10/20/2009

Crude Oil 79.47 -0.49-0.61%

Gold 1061.79 -3.61-0.34%

CRB Index 279.26 -0.39-0.11%

US Dollar 75.382 -0.128-0.16%

The calendar day of 10/21/2009 really does not offer any stumbling blocks to trading forex.

The USD is seeing more pressure to the downside as wholesale prices fell a larger-than-expected 0.6% in September after seasonable adjustments, with energy prices falling 2.4%, the Labor Department reported Tuesday. The producer price index has fallen 4.8% in the past year.

FOREX

I am watching a few things develop in forex and I am going to work on my skills. I am looking at GBP/USD as it is hitting a channel line on a daily chart. Since it is in a 3 month downtrend, I suspect this may hit the upper channel line and may come back down. I am going to buy a sell limit order in a 1.6490 with a stop loss at 1.6591. This is about 50 pips higher than my usual stop loss, but I need a little wiggle room. I may be pulling the trigger a little too early, but I like the set up on the chart.



I am also looking at the USD/JPY. It has been in a strong downtrend and has had an upswing. It is sitting in a narrow channel and 87.10 is going to offer huge support. This is a 200 - 300 pip move. I want my entry to be near 90.54 so I am setting a sell limit order there.

RETRACEMENTS

RULES:
1. A retracement in an uptrend will NOT drop below the previous low. (i.e. it will be a higher low) A retracement in a downtrend will not rise above a previous high (i.e. it will be a lower high)

2. Retracements occur very commonly around even numbers x.00, x.50, etc.

A Gann retracement is specifically a 50% Fibonacci retracement. At this 50% zone, price can either resume its latest dominant trend or reverse the current trend. This was his best place to re-enter a trade in the dominant trend and placing a stop loss below the recent low.

Thus we need to talk about Fibonacci retracements. Fibonacci noticed a recurring theme in nature. The sequence is as follows: 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, etc. When extrapolated to the price of stocks, futures and forex, special attention is correlated to the 38.2%, 50%, 61.8% retracements.

Drawing proper Fib retracements is amust to accurately predict price targets.