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Archives for August 2010

Hit List 8-24-2010

By Filed Under: Hit List

The Hit List is a look at our current swing trading positions. Stocks we are already in have “triggered”, while those we are considering for plays have not triggered. Click post title to view print-friendly link.

0824-2010-List
trading-list-legend
PLCM triggered & stop tightened

Open Position Notes:

LLL declined further today on increased volume once again, working toward Target 1.  This one has been a bit slow, but it has been steady, so I’m sticking with it for now.  I’d like to see Target 1 get reached before looking to adjust my stop, so we’ll see if that happens on Wednesday.  I’m comfortable giving this one some room to fluctuate, and will leave my trade parameters as-is for now.

PLCM gapped through my intended trigger price this morning at the open, so in accordance with my Swing Trading Strategy, I still took the trade but with a reduced position size of 1/2 (because it gapped 1-2%).  This one did work its way off the lows of the session by the closing bell, finishing just slightly negative on the day.  While that’s not the kind of price action I like to see, this is still a technical breakdown for the stock.  I’ve tightened my stop tonight in case today’s break proves to be simply a headfake, but otherwise will wait to see if additional weakness sets in.

0824-2010-Trades

Closed Positions:

No closed positions.

Bandit Broadcast for 8-24-2010

By Filed Under: Videos

Good evening StockBandits!

A gap down open this morning set the tone for the day, and although an attempt at a recovery was staged, it was unsuccessful.  Last night, we saw the indexes resting on short-term support and threatening to break down.  Today, the existing home sales number in the premarket left traders more interested in raising cash than putting it to work.  As a result, we saw a breakdown and a triple-digit decline as the major indexes reached their lowest levels since early July.

At this point, the July lows are the last line in the sand as potential support for this market.  The rally up from those levels was sizeable, and it appeared as though a pullback from the August highs could realistically result in a higher relative low for the intermediate term.  That possibility still exists, but the buyers have yet to step in.  If and when those levels are neared again, we can consider some scenarios which might play out.  For now, the short-term trend is down and that means caution and cash are two good things to have.

Sifting through the charts tonight, it’s easy to see that many have already broken down along with the overall market.  There is some room before the next technical support is seen, so things could certainly continue to slide.  However, on the heels of a 105-point decline in the NAZ in just 4 sessions, I’m inclined to hunt for some long-sided candidates for tomorrow.  There are a few out there I’m eyeing, but if the weakness persists, I’ll stick with existing shorts and the Bearish Watch List down below.

For tonight, my notes are on the charts below for index levels and potential trades I’m eyeing for Wednesday.

Please leave your comments and/or questions below if you have any, I always enjoy the interaction.

NAZ-08242010

Chart courtesy of StockFinder

SP500-08242010

Chart courtesy of StockFinder

RUT-08242010

Chart courtesy of StockFinder

DJIA-08242010

Chart courtesy of StockFinder

VIX-08242010

Chart courtesy of StockFinder

Swing Trading Candidates:

NONE TONIGHT

Day Trading Candidates:

These are the trades I’m eyeing for potential plays tomorrow. I will not be holding these overnight, and will wait for these levels to be crossed before entering trades.

MMYT-08242010

Chart courtesy of StockFinder

FOSL-08242010

Chart courtesy of StockFinder

NTES-08242010

Chart courtesy of StockFinder

OII-08242010

Chart courtesy of StockFinder

Bullish Watch:

CMS, MMYT, FOSL, CRM, MMR, NTES, TSL

Bearish Watch:

WHR, WDC, CBOE, LLL, MON, NAV, CECO, CRL, PLCM, CREE, GRMN, FAST, OII, ESRX

The Hit List post will follow shortly with my trade levels for the swing trades.

Trade Like A Bandit!

Jeff

Hit List 8-23-2010

By Filed Under: Hit List

The Hit List is a look at our current swing trading positions. Stocks we are already in have “triggered”, while those we are considering for plays have not triggered. Click post title to view print-friendly link.

0823-2010-Tradlst
trading-list-legend
PLCM added

Open Position Notes:

LLL worked its way to new lows today on increased volume as it moved further beneath broken support.  This one has yet to accelerate downward, but the stage is set for some momentum to kick in.  For now, I’m staying patient with it while waiting to see if it can move toward the targets in the days ahead.  I like that it’s showing some initial continuation here since breaking down, and now just want to see the pace pick up a bit.

0823-2010-Portf

Closed Positions:

No closed positions.

Bandit Broadcast for 8-23-2010

By Filed Under: Videos

Good evening StockBandits!

The indexes came under some pressure again today as early strength was entirely erased by mid-morning.  Stocks sold off their morning highs, stabilized midway through the session to hover around the flat line, then rolled over once more in the final hour to reach new session lows.  Volume remained light, but the indexes marked new pullback lows on a closing basis and are threatening to undercut short-term support.

It could be that we see those support zones get defended, but that’s not a bet I’m willing to make.  What we have are broken uptrend lines from 2 weeks ago, a solid decline, and some basing action since then.  Even though the trading range of the past 8-9 sessions has been rather wide, the fact remains that this is a consolidation following a momentum move, and that could easily spell downward continuation for this market.

We’re in the late stages of summer between now and Labor Day, which is a reminder that activity will likely pick up in a couple of weeks.  However, there will continue to be opportunities surface for us between now and then, so long as we’re watching for them and not allowing ourselves to overtrade while this market is range-bound.  From the looks of the daily charts, that could change as quickly as tomorrow.  With that being the case, high levels of cash continue to look good, as this market is still struggling to put together a bounce.

One final mention is that I’m visiting family in expectation of a new family member to be born tomorrow.  That could delay tomorrow night’s newsletter depending on how the day goes, but I’ll have something out for you.

For tonight, my notes are on the charts below for index levels and potential trades I’m eyeing for Tuesday.

Please leave your comments and/or questions below if you have any, I always enjoy the interaction.

NAZ-08232010

Chart courtesy of StockFinder

SP500-08232010

Chart courtesy of StockFinder

RUT-08232010

Chart courtesy of StockFinder

DJIA-08232010

Chart courtesy of StockFinder

VIX-08232010

Chart courtesy of StockFinder

Swing Trading Candidates:

PLCM recently broke support and has been unable to reclaim it.  A move lower out of this short-term wedge could bring about another decline, so I’m watching this one for a potential short sale with a trigger price of $27.15.  As with all swing trades, my stop and target levels will be on the Hit List.

PLCM-08232010

Chart courtesy of StockFinder

Day Trading Candidates:

These are the trades I’m eyeing for potential plays tomorrow. I will not be holding these overnight, and will wait for these levels to be crossed before entering trades.

TSLA-08232010

Chart courtesy of StockFinder

VECO-08232010

Chart courtesy of StockFinder

V-08232010

Chart courtesy of StockFinder

NAV-08232010

Chart courtesy of StockFinder

CRL-08232010

Chart courtesy of StockFinder

Bullish Watch:

CF, BID, IT, MMYT, TSLA

Bearish Watch:

THOR, F, VMC, LLL, NUE, EL, ASH, V, SKX, NAV, SLAB, VECO, CECO, CAVM, BRCM, PLCM, CRL, CREE, ALTR

The Hit List post will follow shortly with my trade levels for the swing trades.

Trade Like A Bandit!

Jeff

Trading Lesson – Time Stops

By Filed Under: Trading Lessons

Last week I closed out a trade in BAX from the long side, as it hit my raised stop to take me out for a 1% loss.  This is a closer look at the trade in review, knowing it will offer us some lessons and reminders which will aid us going forward.

BAX had been acting rather well.  Following a sizeable selloff between April and late-May, the stock was able to stabilize.  It briefly broke lows on July 1st, only to reverse higher along with the overall market.  From there, a slow but persistent uptrend began, with a solid series of higher highs and higher lows being established on the daily chart.

More recently, the stock was coiling just beneath short-term resistance, and a breakout appeared imminent with potential for some upside acceleration to occur if so.  With an uptrend in place, a well-defined entry, and a stop loss not far below, I liked the setup and the potential for reward relative to the risk I’d be taking.  Here’s the original chart I posted with the play back on August 8th:

BAX-08082010

Chart courtesy of StockFinder

It triggered an entry the following day, and started to gain some upside momentum.  Then it stagnated, pulling back to repeatedly test the breakout area for the next several sessions.  On August 17th (last Tuesday), it began to turn higher once again, but with limited enthusiasm.  That proved to be a short-lived attempt, and soon after I was stopped out as my raised stop loss was reached.

The problem with BAX wasn’t that it was sending mixed signals, but rather that it was requiring so much time to get going. I realized before I put the trade on that it would likely be a slower mover, but that revealed the biggest challenge with this trade:  walking the line between staying patient with the trade and recognizing that it was going nowhere.

The best way I’ve found to deal with that is to essentially implement some time stops.  By that I’m not referring to hard-and-fast dates whereby if I’m not stopped out or up a certain amount that I just blindly close out the trade.  Rather, it’s more of a finesse process.  It’s about gauging the day-to-day movement with what should be expected.  In the case of BAX, it had already rested as much or more as it did on previous pullbacks, yet the breakout yielded only a fraction of the upside which previous advances had shown.  That was one cue.  Another was the fact that volume remained light on attempted advances once I took the trade, signaling there was less momentum and lighter overall interest in the stock.

So through time stops, when some time goes by and the stock stagnates, I nudge my stop higher.  In this particular trade, twice I adjusted my stop loss to reduce risk.  It’s as if I’m trying to “crowd” the trade in such a way that either it gets moving, or it takes me out.  The idea is not to leave capital tied up in a position that’s going nowhere.  Some patience is necessary, but in this case with multiple other factors confirming that the trade wasn’t progressing as originally expected, a little impatience helped me manage the trade.

It’s no fun being wrong, or getting stopped out for a loss (no matter how small), but as traders, it’s imperative that we keep moving.  We can’t become married to a stock that’s going nowhere, and we don’t want to.  The whole idea is to put capital at risk when there’s an expected reward.  Anytime that expected reward isn’t panning out – especially when given multiple opportunities – it’s probably time to tighten up or lighten up in the trade.

Ultimately, BAX proved it wasn’t ready to go, and I took a very modest 1% loss in the trade.  As I write, the stock still hasn’t reclaimed the breakout zone, and continues to sit range-bound with a lack of momentum.

The Lesson: keep a close eye on not only the price action and volume, but also the clock.  If a trade idea has been given ample time to do its thing, and it’s not happening, perhaps it got stuck in the mud and isn’t going anywhere quickly.  Tighten up your stops aggressively to reduce your risk in the trade, and be willing to take a small loss if necessary.  It’s likely you can make that up elsewhere rather quickly.

Trade Like A Bandit!

Jeff

Hit List 8-22-2010

By Filed Under: Hit List

The Hit List is a look at our current swing trading positions. Stocks we are already in have “triggered”, while those we are considering for plays have not triggered. Click post title to view print-friendly link.

0822-2010-TL
trading-list-legend
LLL triggered, VMW removed (no trigger, pattern negated)

Open Position Notes:

LLL triggered a short entry Friday as it undercut support at $69.40.  Although the stock was able to finish off its worst levels of the session, I was still encouraged by the overall price action with the stock finishing beneath the breakdown zone.  I’ll be watching for follow through in the days ahead, at which time I may make an adjustment to my stop loss.  For Monday, I’m sticking with my existing trade parameters.

0822-2010-PF

Closed Positions:

No closed positions.

Bandit Broadcast for 8-22-2010

By Filed Under: Videos

Good evening StockBandits!

I’m away from the office for a few days so I’m coming to you in written format.  I do like getting to mix it up from time to time, and I know some of you enjoy the ability to skim through the Broadcast as well.  Hope you’ve had a great weekend, and you’re ready to make the most of the week ahead!

Last week, we saw the major averages finish mixed and little-changed from the prior week, leaving them with the look on the surface that not much happened.  However, we did see short-term lows get tested, and on a closing basis, they were able to hold.  That doesn’t necessarily mean the pullback is over, but simply that a rest phase may be starting.  Anytime short-term levels are tested and validated, it’s worth paying attention to.

Given that we’ve seen a good pullback from the highs set earlier this month, as well as the fact that many are taking late-summer vacations between now and Labor Day, it wouldn’t be surprising to see the market stagnate a bit here.  We’ve seen some short-term levels get carved out which could serve as support and resistance zones, so unless some good momentum surfaces, it could be that we see some healthy basing action in the near term within those boundaries.

All of that hinges on the ability of this market to hold those levels, but I’ll outline them below.  If we do happen to see some rest kick in, it won’t be the kind of environment in which we want to get heavily positioned in either direction.  Remember, consolidation phases are simply trading ranges, and whenever that’s the case we need to expect limited follow through and more frequent reversals.

As a result, my game plan for Monday is to keep my timeframe short for any new trades, and then re-evaluate tomorrow night if we see support hold again.  I’m just reluctant at this point to be adding much overnight exposure in an environment where follow through could be hard to come by in the short term (until we see some expansion to this little range).  So, high levels of cash right now look good, as does being hedged or simply trading light until more technical evidence surfaces to become more aggressive.

For tonight, my notes are on the charts below for index levels and potential trades I’m eyeing for Monday.

Please leave your comments and/or questions below if you have any, I always enjoy the interaction.

NAZ-08222010

Chart courtesy of StockFinder

SP500-08222010

Chart courtesy of StockFinder

RUT-08222010

Chart courtesy of StockFinder

DJIA-08222010

Chart courtesy of StockFinder

VIX-08222010

Chart courtesy of StockFinder

Swing Trading Candidates:

NONE TONIGHT

Day Trading Candidates:

These are the trades I’m eyeing for potential plays tomorrow. I will not be holding these overnight, and will wait for these levels to be crossed before entering trades.

CF-08222010

Chart courtesy of StockFinder

JKS-08222010

Chart courtesy of StockFinder

AGCO-08222010

Chart courtesy of StockFinder

V-08222010

Chart courtesy of StockFinder

CECO-08222010

Chart courtesy of StockFinder

Bullish Watch:

POT, BIDU, ATK, CF, CAGC, IT, JKS, AUXL, GES, AAP, MELI, AGCO, GMCR, TTM

Bearish Watch:

DLB, LLL, V, CME, BAC, ICE, CEDC, FCN, CECO

The Hit List post will follow shortly with my trade levels for the swing trades.

Trade Like A Bandit!

Jeff

Hit List 8-19-2010

By Filed Under: Hit List

The Hit List is a look at our current swing trading positions. Stocks we are already in have “triggered”, while those we are considering for plays have not triggered. Click post title to view print-friendly link.

0819-2010-TL
trading-list-legend
VMW & LLL added, BAX stopped

Open Position Notes:

No open positions.

Closed Positions:

BAX was a stock which I expected to be a slow mover, but I have been surprised in recent days just how slow it could be.  After breaking out and showing nice relative strength to the overall market during last week’s pullback, this week the stock has done nothing but stagnate.  I had tightened my stop twice in order to reduce risk in the trade, just in case the lack of upside follow through was an indication of a lack of strength.  It’s a fine line to walk between being patient with a trade vs. recognizing that it simply isn’t going anywhere.  Ultimately, this one proved it wasn’t ready to run, and I was taken out this morning on weakness for a very modest 1% loss.  I’ll give it more time before looking for another entry, as right now the stock simply looks range-bound in the near term.

Bandit Broadcast for 8-19-2010

By Filed Under: Videos

Good evening StockBandits!

Optimism over MFE’s takeover by INTC was erased this morning as Initial Jobless Claims reached their highest levels since November 2009.  Earlier this week, it was a bid for POT which helped fuel the market higher, but today it was all about economic concerns rather than M&A.  The open was met with heavy selling into mid-day, when stocks were able to stabilize but couldn’t recover much by the bell.  In the end, the bounce of the past few days easily negated with today’s weakness.

The poor finishes of the past few sessions have been noted here nightly, and I’ve stated my concerns with the trustworthiness of the bounce.  Today as we saw the decline take away the upside progress made previously this week, it reinforced what I’ve been sensing from the charts.  As a result, I’m looking at the short side for several new plays as the indexes now lean on short-term support.

It’s been a pretty slow week in terms of trading ideas, and my watch lists have been rather sparse up to this point in the week.  However, more setups are quickly appearing and I’m expecting to see more arrive in the days to come.  While I won’t be forcing trades here late in the summer, I will still be seeking out opportunities to put capital at risk when there’s potential for reward.

I’ll cover my game plan for tomorrow in the video, and as always, feel free to share your own thoughts, trade ideas, and questions down below in the comments section.

Here is tonight’s video:

broadcast-preview
The Bandit Broadcast Video – Click to Watch!

–

Video Stocks Discussed: SRS, BAC, SM, XCO, VMW, LLL

0819-2010-VS

Swing Trading Candidates:

VMW sold off hard last week when it broke its recent uptrend line, and in the past 5 sessions it has bounced back up to test that zone.  A turn lower from here could arrive any day if this stock is going to carve out a lower high, so I’m watching this one for a potential rollover move in the days to come.  A break of the $77.20 level would mark a multi-day low, and I’ll be using that as a pivot for going short.  My stop and target levels for this one will be on the Hit List, as with all swing trades.

VMW-08192010

Chart courtesy of StockFinder

LLL has been trending lower for months, and for the past several weeks it has been able to rest.  Currently it’s resting just above support, but if that gets taken out, the stock could accelerate lower.  I’m watching $69.40 for a breakdown to trigger a short sale, and will have my stop and target levels on the Hit List since this one is a swing trade.

LLL-08192010

Chart courtesy of StockFinder

Bullish Watch:

ATK, CAGC, AUXL, SRS, AAP, AEO

Bearish Watch:

XEC, AMG, OIH, RIG, LLL, WDC, THOR, RTN, CRUS, VMW, BBY, GS, CSC, FSLR, V, CME, ICE, BAC, SM, NETL, SPN, BHI, CEDC, XCO

The Hit List will be coming out soon with discussion on open positions and swing trade stops and targets, so be sure to watch for it.

Trade Like A Bandit!

Jeff

Hit List 8-18-2010

By Filed Under: Hit List

The Hit List is a look at our current swing trading positions. Stocks we are already in have “triggered”, while those we are considering for plays have not triggered. Click post title to view print-friendly link.

0818-2010-TL
trading-list-legend
No changes

Open Position Notes:

BAX rested today as it gave back a few cents to stay within the consolidation area of the past few sessions.  Overall, this stock has held up well since breaking out, it simply hasn’t given much follow through.  To offset that, I’ve adjusted my stop twice, and for now I’m doing my best to stay patient with it while waiting for a secondary advance to come along.

0818-2010-PF

Closed Positions:

No closed positions.

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