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$SPY $QQQ – bouncy bounce time…

Looks like it is time for the bounce from Friday to continue.

All three of my swing-trading signals – Price, Breadth, Volatility – gave buys for Monday’s open after last Thursday’s hard slam to the downside and Friday’s bounce.

Everything is still oversold.

My Nifty-50 stock list had 39 nine stocks on sells Friday for the second day in a row. Forty sells is a marker for a bottom of a swing but sometimes the market just goes to far to fast and doesn’t quite get down that far. Also 30 of those stocks are oversold. Thirty is a lot.

The plunge in price Thursday took the Nasdaq Comp to a level that often marks a bottom, and made Friday’s bounce almost a sure thing (see the chart below of the Nasdaq Comp with the previous signals). Given this bull market it is more likely than not we move up again now.

Caution is needed, however, since long-term breadth remains negative and there is no divergence in short-term breadth so it should be noted that a test or retest of Friday’s lows some time this coming week is also likely.

SWING TRADING SIGNALS:

PRICE: Buy. Price (Day 1).
SHORT-TERM BREADTH: Sell. (Day 1).
VOLATILITY: Buy, (Day 1).

CONTEXT:

LONG-TERM BREADTH: Sell (Day 8).
CNN MONEY’S FEAR AND GREED INDEX: (28, greed level).
NIFTY-50 STOCK LIST: 11 Buys; 1 Overbought, 30 Oversold, 4 new buys today, 4 new sells.

Stocks in the Nifty-50 list on buy signals: EXAS, CC, CZR and MELI.

(click on the chart for a larger view)

Niftyfifty2017-08-13_1806

#MarketTiming – Day 4 0f Upswing

The general market moved up again today. Fourth consecutive day up on the Nasdaq. It is the third day of the trade from Monday’s open. A four or more day move is where the money is made in swing trading, particularly with 3x-leveraged ETFs (see table below), or options, or futures.

At the same time, this market is getting wildly overbought. Forty-three of my Nifty-50 stocks are on buys, with 34 overbought. This is a lot.

The Nasdaq composite is more than two standard deviations of an average advance. That puts it on borrowed time for more upside. Needless to say, it can borrow more time. Markets go up until they go down. Simple as that, and this bull market has had an inclination to put on more gains just when one thinks it should stall.

It is time still to let profits run since all principal buy signals remain positive and long-term breadth just turned positive also, making this a market now to buy the dips, any dips.

TRADING SIGNALS:

PRICE: Positive. Long on Monday open (Trade Day 3).
SHORT-TERM BREADTH: Positive. Long on Monday open (Trade Day 3).
VOLATILITY: Positive. Long on Monday Open (Trade Day 3).

CONTEXT:

LONG-TERM BREADTH: Positive (Day 1).
FEAR AND GREED INDEX: (47, rising back into neutral).
NIFTY-50 STOCK LIST: 43 Buys, rising; 34 Overbought, 0 Oversold.

The rally results so far (three full days):

TQQQ up 6.0 percent.
XIV up 5.4 percent.
UPRO up 2.3 percent.
TNA up 2.8 percent.

The net gain for a basket of the above leverage ETF for the three days in the trade is 4.1 percent.

#BullMarket – so many buy signals…

…it is almost scary.

But it is what it is.  I guess the Fed came to save the day…with higher interest rates no less.

With a low above a low on the NYMO after five weeks of highs below highs, it appears bears have one more day (tomorrow) to make their presence felt but after that, if the NYSI up, it will be rocket time again. In other words, new highs across the board someday soon (tomorrow, Friday, next week) and probably then some more…

Also, a nice little divergence there on my nifty-50 stock list from 42 sells in February to 38 four days ago (there are 39 on buys now).  Last time had a similar divergence was at the bottom in November.

(right click on chart for a larger view)

MAIN

#SwingTrading – up move in motion…

TREND TRADE: Long from open, 11/9.

SWING TRADE: Long from open, 12/27.

DAY/SCALP TRADE: Long, long…

PRICE TREND: Up 2 days.

SETUP:

Market breadth continues to climb, prices continue to rise, more and more stocks register individual buy signals…obviously, the move to the upside, triggered Friday, continued today…

It must be time again to state the market’s second clearest axiom -“the market will go up until it goes down.”  (The clearest axiom, reputed to have been stated by J.P. Morgan himself is “the market will fluctuate.”)

Of the stocks on my nifty-fifty list, 20 gave individual buy signals today, bringing the total to stocks-on-buys to 38 up from 18 Friday.  Too numerous to in total, the stocks include X, KRO, CECO, NUE, BAC, LECO, FORM and FAST.

More notable, all eight of the 3x-leveraged ETFs I follow are on buys — TQQQ, TNA, UPRO, XIV, FAS, BIB, ERX, SOXL.

Let’s call the featured chart below “After Consolidating SPY Tries To Resume Its Rally” because it likely will.

(right click on the chart for a larger view)

trendswing_2016-12-27_0818

 

 

#DayTrading – the simplicity of the market…

TREND TRADE: Long from open, 11/9.

SWING TRADE: Flat from open, 12/22.

DAY/SCALP TRADE: Long bias but short scalp possible..

PRICE TREND: Down 2 days.

SETUP:

Today was down across the board on follow-through from the breadth turn down 12/20.  Assume tomorrow with be more of the same.

Markets go down until they don’t anymore.  Been told that is as dumb a statement as can be made but it is in fact absolutely true and it is the very basis of simplicity so often unrecognized in market movements.  It is that simple, the market is either up or it is down.

Recognizing the simplicity is where the money is made in trading.

Again, aggressive traders might want to play the short side via short ETF’s — SQQQ (featured on the chart below), TZA, UVXY.  In fact note the previous bounce on SQQQ, not a bad scalp for some profits.  Could happen again.  Now.

(right click on the chart for a larger view)

day_trade2_2016-12-07_1311

 

#DayTrading – signals…

TREND TRADE: Long from open, 11/9.

SWING TRADE: Buy from open, 12/14.

DAY/SCALP TRADE: Long bias but short scalp possible..

PRICE TRENDS: Down 1 day.

SETUP:

Failed to post this yesterday due to time conflicts but for the record this is what was.

Although the longer term remains bullish, market breadth gave an ominous short-term warning of a possible dip in the market (which was posted, see below).  As a result there were no day-trading stocks to buy and in case the dip might become a tumble, stops needed tightening on swing and longer-term positions to preserve profits according to one’s own risk tolerance.

Scalps would be easiest on the 3x-leveraged ETFs: SQQQ, TZA, SPXS and for the those addicted to the wild and one-day crazy, UVXY (today’s move featured below).

(right click on the chart for a larger view)

day_trade2_2016-12-07_1311

 

#MarketTiming – early warning signs…

One of the great things about market breadth is that over and over again it warns when a rally is weakening.  It usually takes more than one warning before a pause becomes a fall but…

Actually, it usually it takes three and we are at two early warnings now.

See the red circles on the chart below, both past and present.  And note how often they are the precursors for sell-offs to come. Sometimes this trading and investing is simpler than most analysts and Wall-Street players would have to common man believe.  But one must take heed.

Not saying this rally is over.  In fact, it is just the kind of rally (like the Brexit rally last summer) that can go on confounding bears and confounding indicators as it rides waves of too easy money, a seasonal bullishness, and like all bull markets the tendency to go up until it stops going up..

But the warnings are here now and beginning to repeat so this is becoming a time to take some profits or to tighten stop-loss points to make sure not too much is lost when a serious tumble finally takes hold.

(click on the chart for larger view)

twitter_day2016-12-12_0842

#DayTrading #Stocks – today’s net…

Despite the market weakness across the board today, and a turn down in short-term market breadth, stocks that signaled individual buys for today’s open finished the today’s day-trade with four winners and four losers, essentially flat (up .15%) as a group.

day_trade2_2016-12-07_1311

The leader (above) was HIIQ up 6.18 from today’s open, and NUE , featured with a chart in yesterday’s tweet, (below) managed a small gain (.37%).

Mirror, mirror, what’s the fairest rally?

This is a follow-up to the entry below entitled “To Brexit Or To Exit”.

It was suggested the current rally would continue to mirror the immediate post-Brexit, rally as it has been doing week-by-week since the election.  That continued today as the market put another spike up right on time (see the bars in the red ovals on the right and the left).

If the mirroring is to continue the market should put in two more up days this week before beginning a long chop-chop, likely for the rest of the year.

And it was suggested the rally would likely resume today into the end the week.  That is still likely unless the Fed kills it with news tomorrow.

(click on the chart for a larger view)

it_rhymes3