Wednesdays Gameplan

Longs: AMGN

Breakouts: GG> 56.00, KO>70.00, PM>68.00 (HBO), DOW < 25.50, BBY<23.00, JPM>33.50 (HBO & Gap fill)

Notes:

Very few setups today as the market is becoming impossible to predict under the gappy conditions, I might stand aside today while this market does what it wants to do. A retracement seems most likely to continue, however, anything is possible.

SPY failed to take out lower trendlien support with the QQQ being the strongest followed by the SPY and DIA.

Tuesdays Gameplan

Longs: PM (68.00), HON (45.50 & Double Bottom), KLAC (34.00 & Support), AKAM (20.00), PCAR (35.00),

Breakouts: TJX <52.00, JNJ<64.00 (Trendline break), VLO < 21.50 (Trendline and Support break)

Shorts: GG (55.50)

Notes:

Very choppy market at these levels making it almost impossible to predict the next direction in the market, but if I had to make a guess I would say south cause of the direction of the trend and the breakout in the TLT. (GLD) Gold very dangerous at these levels with R/R favoring the short side, volume has contracted and a gap up is expected which should be filled to the downside. SPY and DIA look like one big bearish flag thats about to crumble.

COG

Tuesday's Gameplan

Longs: KSS (Wedge > 47.75)

Breakouts: JDSU>12.35 (HBO), ETN> 43.00, EBAY>31.00, ALTR>37.50, XOM>74.50, KO>69.75

Shorts: AKAM (22.00 & 20SMA), CHK (32.00), QCOM (51.50), KLAC (37.00), UAL (19.00), EBAY (31.00), DPS (38.00), HON (47.50),

Notes:

KO

The market yesterday went up on below average volume to do the weather concerns in the USA, today we have imporant news releases coming out as well with the FOMC meeting being the most important. At this stage, the market is at crossroads and could head in either direction, the market is also poised to open lower today which would nullify my saturation shorts. Should the market open lower, yesterdays high will be me key reference point for my shorts, an initial failure to take out the highs after a push higher from the open would deem my saturation shorts valid. However, should the market head higher and take out yesterdays highs, that would probably trigger my breakouts trades. Should these breakout trades fail, my shorts would come back into play again through the red dog reversal.

EUR/USD down.

International markets are mixed.

Mondays Game Plan

Breakouts: COH>55.00, EBAY>29.50, CHK>33.65, DPS>36.50, AET>38.50, DOW>27.00, UNH>46.25, KO>69.50,

Shorts: IAG (20.75), GG (52.00)

Notes:

SPY wedge pattern that could break to the upside today unless we get a significant gap down.

QQQ gap fill from August 17th.

IAG and GG should open higher.

Overall I have a feeling we will get a choppy day today in both directions prompting me to book profits on momentum.

Thursdays Game Plan

Longs: GG (SAT@ 48.00)

Breakouts: UNH >46.00, AET>38.50, COST>77.50, KO>69.80, TRV<48.50, XOM>74.50

Shorts: CC (SAT@28.50), ETN (SAT@41.20), AXP (SAT@48.30), BBY (SAT@25.00), CHK (SAT@30.20), SBUX, DD (SAT@46.25),

Notes:

KO
TRV Could breakdown due to weather news.
EUR/USD key level at 1.4500 - 1.4350, 3 inside days.
Jackson Hole Symposium
AAPL Steve Jobs Resignation

Wednesdays Game Plan

Longs: GG

Breakouts: ALTR>37.65, AET>38.50, ZOM>74.75, AXP>46.50, KO>69.75, COST>77.50, MCD>89.50, BBY>23.50, DPS>36.50 (HBO), TRV<48.50, WAG<34.00

Shorts: JNJ, COH, ALTR, WFC, JPM

Notes:

MCD about to make new 52 week highs.

SPY key level to watch is 116.50

GLD the gold ETF got hit on ultra high volume to the downside.

EUR/USD still choppy, possibly forming a cup and handle pattern with 1.4500 being the key level.

Friday's Game Plan

Breakouts: COH> 55.00 (ATR= 3.80), TRV> 52.00 (HBO), UAL<16.00, GG> 51.00 (HBO after gap fill)

Shorts: HON (SAT@ 47.00 ATR=2.35), ETN (SAT@42.00 ATR=2.53), DPS (SAT@38.00 & 200 SMA ATR=1.35), PM <65.00 (ATR=2.12), KLAC

Notes:

No long setups today as the environment is dangerous and any attempt to catch a falling knife could cause severe damage.

Industry sector strength indicates that the most defensive sectors were up yesterday confirming the bias of risk aversion. The industrials were the strongest along with consumer staples and healthcare.

Financials were weak which is a concern, the XLF also broke down and failed to breach resistance (previous support) yesterday.

VIX @ 36.00, hence the volatility. Almost double the normal move. I remain cautious trading smaller size and keeping an aye on my ATR to properly place stops and give my trades enough room. The last thing I want in this environment is to get shot on good ideas due to lack of room in placing stops.

Mondays Game Plan

Longs: C (SAT@31.00), NVDA (SAT@12.65), EBAY (SAT@28.50), COF (SAT@41.00),

Breakouts: EBAY<28.00, UAL<16.50, SNDK>40.00 (HBO), AXP<46.50, GG>46.85 (HBO),

Shorts: SWN, WFC<25.00,

Notes:

Market highly volatile, risk should be adjust according to the VIX and the stocks daily ATR.

VIX @ 32.00

XLP strongest sector, indicates defensivness from investors. The XLP also failed to breach its 200 DMA.

Oil te weakest sector in my list.

Friday's Game Plan

Longs: MCD (SAT@84.00 and 50 SMA also relatively very strong), JNJ (SAT@61.50 and Gap cover), AET (SAT@37.00 & 200 SMA), AXP (SAT@47.00 The level should hold first), QCOM (SAT@50.50 - 50.00), COH (SAT@ 57.80 & 200 SMA and also right below support).

Breakouts:TRV<53.00, WFC<25.25, GG<45.60, UAL<16.50, SNDK<38.75, KFT<33.75 Shorts: JPM, ALTR, XOM, KLAC, MS, C, NVDA, DOW< 30.25 Notes: Markets sold off very hard yesterday amid liquidity concerns, the markets are also oversold, but under these conditions, liquidity trumps all.Waiting for NFP today, which could is the catalyst today, under these conditions anything can happen. Things can easily overshoot. This market could do one of two things today, the first being a rally early in the morning and then a sell off after paniced investors sell their holding into the rally. Or, we get a sell off right off the gates, as panicked investors continue selling after a bad NFP number. OIH was the weakest sector yesterday along with commodities such as silver and gas. In other words, everything got teared yesterday, nothing was relatively strong. Yesterdays high and low are my reference points in this environment. MCD my best play of the day, strongest stock in my list after yesterdays sell off, thus making it relatively very strong. COH is my Joker play today, as it has the potential to fool people the most. VIX> 30.00, Caution is advised.

Wednesdays Game Plan

Longs: KLAC (SAT@38.00), HAL (SAT@52.00), SBUX (SAT@38.00), TJX (SAT@53.00 & 50SMA), MCD (SAT@85.00), JNJ (SAT@63.25 & 200 SMA), PM (SAT@69.25, 20DMA and Support), KO (SAT@67.00 & 50 DMA)

Breakouts: EBAY<31.70 (HBO Gap Cover), C<37.00, GG>49.75 (HBO & Gold strong), VLO <23.00

Shorts: WAG (Gap Cover), DOW, ETN, COF, ALTR

Notes:

The SPY has a last line of defence at 129.50, should this level be breached, I expect selling to continue. The last 3 down days have been on ascending selling, meaning that sellers are stepping up their selling.This being said, the market does look oversold at these levels, and a bounce might be in play today.

I will be looking for saturation longs in this environment given the oversold market. I will also not give them much room should selling re-ignite. My bias for this market is bearish at the moment, so any longs would be taken with extreme caution. Holding on to short positions is also a challange as markets get volatile and re-entries could be necessary stocks arent given enough room.

VIX @ 24.50

EUR/USD rallied overnight.

Should the market open inside yesterday, I will pay attention to the breakout levels and yesterdays low. Should yesterdays low be taken out on high volume then that would be a sell signal.

C<37.00, TJX, JNJ & GG

Tuesday's Game Plan

Longs: QCOM (SAT@53.25 & 200 DMA), SWN (SAT & 50 DMA), NEM (SAT@54.80), XOM (SAT@78.80), GG (SAT@200)

Breakouts: WAG<38.50, JPM<39.00, HON<52.00 (HBO), COST<77.00, COF<47.00 (HBO), ALTR<40.00

Shorts: NVDA (SAT@14.50)

Notes:

SPY is barely holding the 200 DMA which is one of the last lines of defence for the bulls. Should the level crack, I expect the bears to step up and send the market lower.

Not many setups after yesterdays open higher and sell off. Most of my charts are messed up. However, I am mostly bearish, I will wait for my break downs to form before tipping my hand in this market.

At the time of this writing gold made a new recort high of $ 1634.68.

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.

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.

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,

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.

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.

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.

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.

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.

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.