Sunday, July 31, 2011

Mondays Game Plan

Longs: DD (SAT), DIS (SAT@38.50), GG (SAT@ 47.30 & 200 SMA)

Breakouts: ALTR<40 (HBO), ALTR>41.00, TJX<54.70 (HBO), COST<77.50, WAG<38.75, AET<40.50

Notes:

WAG < 38.75 would start filling the gap

DD narrow ranged down candle on very high volume could signal that the bears are having trouble sending prices down.

Friday, July 29, 2011

Fridays Game Plan

Longs:TJX, MCD (SAT@86.50), MS (SAT@21.85), DPS (SAT@38.00 & 200 SMA), VLO (SAT@24.80 & 200SMA & 50% retracement), JDSU (SAT@ 13.00), UAL (SAT@17.00)

Breakouts: QCOM<54.50 (HBO), KO<68.50 (HBO), AXP<50.50, UNH<50.00, COF<47.50, JNJ<64.75

Shorts: BBY

Notes:

TJX 54.15 is a possible saturation gap fill. MS possible gap fill and saturation at 21.85.

Breakdowns is what I am looking at today.

All saturation plays should be confirmed by the tape today given the choppy market environment also the fact that todays friday and no one knows what will happen over the weekend should be taken into consideration in these times of uncertainty.

Out of the indexes, NASDAQ strongest followed by the S&P 500 and the DOW.

Thursday, July 28, 2011

Thursdays Game Plan

Longs: JNJ (SAT@65.00), WAG (SAT@ 38.75), AXP (SAT@50.50), COF (SAT@50.75 200SMA), GG(SAT@47.50)

Breakouts: TRV<56.10, AXP<50.50, COST<77.50,

Wednesday, July 27, 2011

Wednesdays Game Plan

Longs:DPS (SAT @ 39.50), UNH (SAT@ 51.00), HON (SAT@55.25 & 200SMA)

Breakouts:EBAY>35.00, ALTR (IDB R= 42.28 S= 41.60), TRV<56.50, MCD (R= 88.45, S= 87.85), DPS<39.50

Shorts: EBAY (SAT)

Notes:

Still very choppy, will trade with care till the debt issue resolves itself by booking on momentum.

Tuesday, July 26, 2011

Tuesdays Gameplan

Longs: COF (SAT), DPS (SAT 39.50), UAL (SAT)

Breakouts: RTN<46.25 (HBO), WAG (IDB R= 40.20 S= 39.70), C> 40.50 HBO, CIEN (IDB R=17.50 S=17.20), GG>55.25 (HBO), DPS<39.50

Shorts: SMDK

Notes:

C formed a cup and handle pattern on the hourly which qualifies as an HBO

Markets highly uncertain due to the US debt talk. Being extra cautious in this environment is best, booking on momentum.

Thursday, July 21, 2011

Thursdays Game Plan

Breakouts: JPM>41.75, GG>55.25, MCD>86.50 (HBO), KLAC>43.00 (HBO), BBY (IDB), DIS>39.85 (HBO), KO (IDB)

Shorts: MS (SAT after earnings came up better then expected)

Notes:

Very few setups today due to the choppy action in the SPY and the fact that we are in the end of July and people are on holidays.

I will be watching the 133.25 key level in the SPY today as any break and hold above could signal continuation.

Choppy action in the EURO as news related events are moving it all over the place. MS reported better than expected earnings, I am looking at that short today after the gap up.

Friday, July 15, 2011

Observation

SPY in no mans land here with bias to the downside, after all the pushes up in the past several days was met with selling on above average volume. I will be watching 131.50 closely today as any break below this level could result in a down day.

The financials continue to take a beating in this market, and until the sector regains some footing in this market, I expect the decline to continue. Tech is also weak which isn't a good sign for the market with the SMH about to breakdown below 32.50.

Gold however, has returned to its prior strength on global concerns which could make gold stock attractive to the upside.Should the SPY open inside yesterday and above yesterday close I would look for weakness and should it take out 131.50 I would be getting more agressive selling. To the upside I wan to see 133.00 taken out before getting long.

Wednesday, July 6, 2011

SPY Observation




Notice the SPY chart above. The last 4 up days up days were on declining volume. Typically, I would sell into a move like this assuming that the up days were on declining volume which signifies contracting demand. However, this might not be the case here, if you observe more carefully you will notice that the rise was on extending ranges which is a revelation. The extended ranges could mean that its not that price found no demand hence the declining volume but that price found no supply as prices exploded higher and higher without faceing any counterforce to send it down.

Yesterdays inside day was also interesting. Sellers could send prices anywere as buyers maintained control, it is important to not however, that price is currently at a resistance zone and a breakdown from the inside day could find continuation to the downside.

Levels to watch are the 134.00 level, it is important to watch this level as prices has always struggled here in the past. This and the fact that the inside day's high is at the same level, which could pave the way for an explosive move. 133.50 is also key here, as a breakdown down from this level is significant. It is so because the level is the inside days low and because price is at the top of its range for the past 6 months, this range has proven to be resistance in the past and could push prices lower again. It will be interesting to see how price reacts from here.

Monday, July 4, 2011

Inside Day Breakout (IDB) Setup



Inside Day Breakout (IDB) is another setup that I use to affectively take advantage of explosive moves that occur after periods of congestion. I usually like to use these setups in the direction of the trend, but tend to trade them in both directions in choppy market environments.

Basically an IDB occurs when on days where price action occurs inside another range. This happens when buyers and sellers fight for control, both having equal strength. Once the market breaks out of the range a victor is found, this usually results in an explosive move in that direction.

IDB can occur over several days and don’t require price to consolidate in one day’s price range. In the chart above 3 days IDB's are occur and usually demonstrate more follow through and stronger moves than the 2 day IDB's. This is due to the extended battle between buyers and sellers. Think of IDB's this way, imagine a can of coke that you shake violently for a period of time, the longer you shake the stronger the burst once opened.

My entries in IDB's are a five minute candle close above yesterdays high or low with my stop back inside yesterdays range. I usually trail the setup depending on what is demonstrated on the tape, if I see an aggressive tape I give the trade more room by trailing it through the 10-20 SMA's on the 5 minute chart. However, should the tape slow down or should the market environments change, I book into momentum.

Pretty simple setup, that works brilliantly in the hands of a consistent trader. Consistency and preparation are key to the success of any trading strategy.