$USD – a vote on the country ever day…

Given that currency trading is a vote by the whole world on your country every day and now that President Blowhard believes the dollar’s recent rise was because of “confidence” in him instead of an overflow from the Obama Administration, the US dollar is likely to decline now.

Trump commented that yesterday that the dollar was too strong because of “confidence in me”, but the currency has been going sideways to down since his inauguration.  Confidence in him?  More likely a rising lack of confidence.

And of course, the US dollar always does decline in Republican Administrations.

That was never more pronounced in historical terms than the day George W. Bush made his “Axis of Evil” speech.  That moment was the precise top for the dollar in his term.  It was as the entire world heard that and thought that guy is crazy and ran for cover.  It declined 40 percent and has not completely recovered.  No analysts ever seem to want to talk about it, preferring to say a weaker dollar makes American multi-national companies more competitive, but think what a drop of 40 percent in net worth means to the biggest economy in the world.

Subsequently, from the day Obama locked up the Democratic Party’s nomination in 2008 the dollar bottomed.  It was as if dollar bulls knew he would be President and were, after the raging uncertainties of the Bush Administration, damn happy he would be.  There were some wild swings in the currency as Obama battled Congressional Republican obstruction (shutting down the government…) but once he was reelected, it was clear sailing to the upside until now.

So what now?

The new era of raging uncertainties is just beginning so, despite professed Fed Reserve tightening, it is probably best to be defensive, if not downright bearish, on the US dollar.

(right click on the chart for a larger view)

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#MarketTiming – once again the bull runs…

TREND TRADE: Up from open, 1/25, possibly whipsawing.

SWING TRADE: Up from open, 1/20.

DAY/SCALP TRADE: Buying the dips with the trend trade

PRICE TREND: Nasdaq up 1 day, whipsawing.

SETUP:

After giving all the signs of an impending sell down, the market took off again to the upside.  This has happened a lot during the later stage of this bull market.

Each time breadth has turned up (which it did again yesterday), the market has had a run so at this point the past of least resistance is again up.  See how XIV, the leveraged inverse VIX ETF, has performed with the market behind it on the chart below (the green vertical lines marking each new surge like yesterday).

But the signs for a sell down remain, at least for now, so trading here is tricky and a buy and hold strategy downright scary.  Appears the market chop has an upward bias but that is the way it was Tuesday.  Today late may be another matter.

Stocks on my nifty-fifty stock list went from 19 on buy signals to 38 in a day.  Stocks coming off recent sell downs that might produce at least a swing bounce or scalp trade include the banks JPM, C, GS, BAC and a big cap on the list, DIS.

Should be noted I guess that airlines, ALK and HA, on the list remain oversold and could play catch up in the next couple of days if the market continues yesterday’s bounce.

(right click on the chart for a larger view)

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$USD – the dollar historically speaking…

Historically speaking, the US dollar goes to hell under Republican administrations.  Does anyone actually expect it to be any different this time?

May take a while since Janet Yellen’s term has year or so to go and apparently the Federal Reserve is now determined to hike interest rates. But eventually, the businessmen now running government (who of course are totally unaware that the government is not a business) will want to debase the currency.

There is the belief that a weaker dollar enables American companies to more easily compete against competitors around the world.  Maybe so. But every time I look up while the dollar is down, it is the competitors buying US companies instead of buying their products.

Oh, well, this Bud’s for you.

(right click on the chart for a larger view)

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#DayTrading stocks – 82% winners this week so far…

Market breadth turned up on Friday (11/2) giving a buy signal on the major indexes and since the vast majority of stocks move with the market direction, Friday’s buy signal cleared the way for stocks to move higher.

Conveniently for the start of the week, the time to initiate buys was the open of Monday. If we look back there were four stocks in my nifty-fifty stock list that gave individual buys for Monday’s open — SCHN, CECO, TBPH and RIO.

The idea was to buy on the open and sell on the close, a pure day trade on each stock. The value of this kind of trading allows the trader to leverage with margin and retain buying power leverage for each day.

Monday SCHN, from open to close, netted 1.8%, CECO lost 1.2%, TBPH gained 1.7%, and RIO gained .4% for a net of .47%, exclusive of slippage and commission for the basket. While that was not a great gain (leveraged it would have been at least twice as much), it was a profit, and it should be noted that was the first day of the turn to the upside for the market.

And as Monday’s market rally got moving, it generated 13 individual stock buy signals in the nifty-fifty stock list. Again it was buy on Tuesday’s open (today’s open) and sell on today’s close.

The results for today’s 13 day trades in stocks — FCX up 1.1%, ACM up 2.8%, NVDA up 1.2%, BBL up 1.5%, TPC up 3.9%, DGI down 1%, NAV up .8%, BHP up 2.2%, IRBT up 1%, FPRX down .01%, ADSK up 7% (highlighted on the chart below), ACAS up .4%, and TWI up .2%.  An un-leveraged net across the basket of 1.6%.

Stocks from my list giving buy signals for tomorrow’s open  are HIIQ, MSCC, GPS, IGT, UAL, and BRKS.  So we’ll see how those go. (These are presented here for entertainment only and are not be construed as market advice.)

(right click on the chart for a larger view)

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The #StockMarket – it rhymes…

It is said history may not repeat so much as it rhymes.

Repeats, rhymes, whatever.  This time looks more like a repeat.

The chart below featuring the Nasdaq Comp (the heavy green line with the diamond) shows the market action pre-election and the reaction since in comparison to the Brexit sell-off in June (the plunge on the left). Note the one-day dips (most recently last Thursday) before the next big run in both instances (the darker green circles), which is to say the market is above to keep going higher, maybe all the way to Christmas.

Yeah, at least a rhyme.

(right click on chart for a larger view)

it_rhymes

 

#Great8Stocks- Top stocks in a Nifty50StockList

These eight stocks rose to the top of my nifty-50 stock list as the market began the current rally.

Into to the recent low the SPX declined 9 days in a row which is called stretching the rubber band too far.  No wonder there was such big blast to the upside yesterday.

With the market down 8 days in a row, breadth turned up on 11/3 giving a buy signal for the open of 11/4 (as has been said before “buy when the market tells you, sell when the stock tells you”).  From the open of 11/4 to today’s close (11/8): CLCD is up 1%; CWEI, UP 15.4%, FNSR, UP 3.4%; NFLX, UP 1.8%, NTES UP 3.5%, TBPH UP 6.4%, TWI UP 14.1%, and XRS UP 5%. Deeply oversold leads to wildly overbought in a hurry sometimes.

I think the market will have one more downside swing (for whatever reason — Trump, initial profit taking, too much up too soon) but if that swing does not rip out the recent low, we will likely be in the Santa Claus rally.

The stocks below are in my personal trading journal (not a recommendation for anyone else), with appropriate stops of course.

(right click to see a larger image)

great8

 

Following the bouncing market: a progress report…

The market bounce suggested in this link — What goes down too far too fast bounces — two days ago, a market-timing buy signal for yesterday’s open is currently playing out profitably as the general market has continued up for the second day in a row.

The Nasqaq Comp has rallied 72 points since the bounce call two days ago.

So far the 3xLeveraged ETFs mentioned: TQQQ is up 2.1 percent, UPRO up 4 percent, TNA up 2.5 percent, the leader SOXL up 5.1 percent; and notably, a steady leader all this year, BIB is flat so far on this swing.

Among the top stocks ORCL is up 2.5 percent, AMGN up 3.2 percent, GILD up 2.8 percent; and notably, perennial leader, AAPL is not participating so far in the bounce and is flat.

For options plays: the QQQ August 110 in the money call is up 20.5 percent and the SPY August 207 in the money call is up 46 percent.

The time nears to tighten stops or take some profits on this bounce but the next question will be can it morph into a full-fledged rally?

Update (Day 4 of the bounce (Thursday’s close):

Fairly positive day in the market. The Nasdaq Comp is up 89 points on this run.  TQQQ is now up 4 percent on this swing, UPRO up 5.1 percent, TNA up 2.8 percent, SOXL up 6.8, and BIB up 2.1 percent. As for the stocks mentioned above ORCL dipped to 2.3 percent but AMGN moved up another 2.3 percent today and GILD, 2.1 percent. AAPL is still flat; if it doesn’t play catchup tomorrow, I have more on that later. Futures (NQs up 26pts) and call options again had a decent advance for the day.

Almost needless to say, this has been a good week for the bounce call above but it’s getting a bit extended. So again, as a swing trader, I am taking profits and tightening stops to lock gains for this swing but that’s just me.

(Click on the chart for a larger picture)

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