Day Trading – The Bullz And Bearz

IBM Stops Talks With JAVA, Short Trading Week Starts

April 6th, 2009

Good morning all! After such a great weekend of weather here on the East Coast, it’s hard to jump back into the trading week – but here we are on Monday. At least it’s a short week – remember that Friday the market’s are closed for Good Friday. I hope that everyone saw the very comprehensive post I did on Saturday. I went over some very important charts that everyone should be looking at over the next week or so to get and idea of where the markets are heading. Additionally, the Member’s Only portfolio video went up last night. I went through all my current positions and my strategy for the week ahead.

US futures are slightly lower this morning before the open on various earning outlook news and expectations. Below are the S&P intra-day support and resistance targets for you all. I don’t think we will see any of these levels hit today, but you never know in this volatile market.

The big headlines this morning really surround IBM and JAVA after acquisition talks have stopped. Below is the chart of JAVA which was enjoying a gain of about 80% or so after the buyout expectations. Now it looks like it will over down over 25% to somewhere in the green area on the chart. Talk about a roller-coaster ride for these shareholders!

We Just Saw The Best 20 Sessions In Stock Market History

April 4th, 2009

That’s right folks, you have just lived through the 20 best sessions for gains in US stock market history. Even as I sit here in my bear fur coat – not seriously – I still have to admit that it’s pretty incredible. You know they always say that the most money is made right at the end of bear markets. Now, I am in now way saying here that this bear market is over. I actually of am the opinion that we have just started a very – again very – long term bear market. One that might last years not months. Okay, now that I have congratulated the bullz for their gains, it’s time to get realistic.

I have spent the last couple of hours here tonight going over chart after chart. And everything I am looking at is running up against multiple overbought indicators as well as major indicators. Let’s just look at a couple, starting with the NASDAQ for a change. Below you can see that we have hit the underneath of that ascending trend line almost exactly. What you also don’t see on this chart is that we have also run up against a very long term Fib fan level at the exact same point.

To go along with my bearish feelings, here is a look at AMZN. Not only has this stock gone up nearly 100% on this move, but it’s hit a MAJOR resistance line going all the way back to 2007. I really don’t see why anyone would buy something like this now? The nearest support might start around $70 when this begins to fall.

Now onto OIL. I continue to feel that Oil is one of the best comparison charts for the markets in general. From the chart below you can see that it has had a huge pop during this rally – but it’s just that, a “pop” – and needs to start basing. You don’t have to have a degree from Harvard or MIT to see that the chances of Oil retracing back to $45 are higher than it rallying up to $65. Again, this is why technical analysis is so profitable – it takes the emotion out of trading and works off proven strategies.

And finally we have the financial sector – by way of the XLF. Not only has the sector gone up by over 60% but we have again come into major resistance around $10 near the Fib retracement level in purple. Again, I am not saying that this is going to roll over and go straight down- that would be unrealistic. But as with all trading positions you want to be on the side with higher odds or percentages right? So given how high the XLF has come and all the resistance so close above it’s head, the chances are higher for a reversal – even if it’s short term.

Wow, that was a long but needed post tonight. Members and I got into a handful of great shorts on Friday before the close. I have very high expectations for these shorts – i.e. profit targets of 20-40%. They will need time to mature of course but we are on the right side of the trade in all these positions. Believe me when I say that we are going to make money on these! I’m sure I’ll even be linking this exact post later on down the line when I have another “I told you so” moments. Memebers Only video will be going out tomorrow so there is still time to jump in! Now it’s time to go enjoy this great east coast weather!

Protected: Member’s Only Portfolio – April 5th

April 3rd, 2009

Jobs Report Will Start The Breakdown

April 3rd, 2009

Good Morning! As usual, it’s very important that you take the time to watch last night’s Trading Video if you haven’t already. I went over some critical technical indicators that I am following with regard to the S&P. As most of you have already heard on the news, the US jobs report can at 8.5% unemployment rate – really a horrible number. Looking through the numbers most industries lost jobs – including the government – if you can believe that. The markets has a very quick knee jerk reaction but have seem to shrug it off pretty well. I still thing that we have a lot of over-head to supply to get through, so any rally today will be short and sweet – if that.

Below are the new S&P intra-day trading targets. If you remember, the levels I posted an mentioned yesterday morning - namely the 844 level – were nearly perfect in predicting a mid-day turn in the markets. As I said in the video, these levels are not made up or pulled out of this air. I have specific indicators that help me determine these levels and that is why they work so well. If we move higher then the 857 level – or really anything from 850 and up – is going to be huge resistance.

I am still of the opinion that waiting for an short term top to form is better than going long at these high levels. The risk/reward is just too risky for a long play but looking great for shorts and puts. Let’s see where the end of the week takes us!

I Don’t Pull These Targets Out Of Thin Air People

April 2nd, 2009

ECB Lowers Rates, Jobless Claims Up, Market-To-Market In Play

April 2nd, 2009

Good Morning! Today is going to be one of those crazy, volatile, interesting, etc. type of days given all the Mark-To-Market news. Jobless claims should help to subside some movement as they were up about 12,000. Clearly, employers are not hiring which is an underlying bad factor for the economy. Still, as you probably have seen the futures are up very big overnight and are sitting right at the highs of last week – or about 830 on the ES S&P Mini’s. As I said in the video last night, if we break above the gap then we are headed higher short term.

As such, I am moving the portfolio around this morning – as only members know – at the open to re-position us for the next move in the markets. In general, we are closing out a bunch of our shorts at very good – not great – profits. EOG is just one example where we are making 12% since we shorted it just over $65 – the complete trade is in green. Even though I would have liked to make more than 20% on this type of trade, 12% is better than what other people would make all year.

Below are the S&P intra-day targets, I am pretty confident that as we get into the 844-850 level we are going to see major – again MAJOR – resistance which we need to fight through. As a side note: I see a lot of people who are running around crazy today and I don’t get it? Surprisingly, I have extremely happy to be closing out these shorts today, make some more money, and wait for higher short levels later on. They will come and when they do, we are going to jump back in.

Another Volatile Day Leaves Us Back At Square One

April 1st, 2009

Housing & Manufacturing Send Us Higher, For Now

April 1st, 2009

Okay, well the futures sure didn’t price in all the somewhat better than expected news on housing and manufacturing late this morning. Given that we have given up a lot of everything we gain these past couple of days, it’s hard for some people to hold onto their shorts. But if you take a quick look at the intra-day chart below of the S&P you can see that we are bumping our heads against the same area of resistance from yesterday. Pretty amazing how strong this area is huh? Additionally, you can see there is really no strong support until we get to 780 and then 765 after that. I have a plan to protect what profits are left in case we do blow past this overhead resistance tomorrow, but more on that later tonight in the Trading Video.

Oh yeah, I also found it very interesting that Oil fell today about 3% and didn’t drag the markets down with it. Personally I think that we will see the markets catch up by the end of the week. Broken record playing again but we need to come close to re-testing lows before a major bull market – or even a mini-bull market – starts getting underway.

Bankruptcy May Be Best Option For GM – Futures Lower

April 1st, 2009

Obviously the late day sell off we say yesterday was a warning for this morning’s GM – Government Motors – bankruptcy news. As usual, technical analysis proves again to show the early warning signs. Let’s see how we end the day of course but the 770 level on the S&P is very important first level of support for the bullz. Below is the S&P support and resistance levels for you all. Oil also seems to be down about 3% this morning. As I kept saying, Oil is clearly leading the markets lower so we have to watch it very closely in the coming days. Happy Trading!