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.
MDVN closed
Open Position Notes:
CBT had some pre-market prints below my stop loss level, but never traded down to the $25.80 level once it opened on the NYSE. Stops with my broker are based on the primary exchange, in this case the NYSE, so I am still in this position. Today’s action was very dull, although the stock was able to post a minor gain and exhibit a little bit of relative strength. Overall though, it was a day of rest. I’ll stick with my existing stop heading into tomorrow, as I still plan to keep it tight given the lack of strong upside volume since the breakout.
VNO slipped a little today, but no technical damage was done. Overall, this one did a pretty nice job of shaking off the widespread market weakness and holding up rather well. My stop did not change tonight, as I’m giving it a little breathing room while waiting for some follow through to arrive. If not, I’ll be looking at a small and manageable loss.
Closed Positions:
MDVN climbed early in the session to push through Target 1 where I booked 1/2 profits for a solid 5.9% gain. It then reversed and turned lower. The stock was able to rebound from its worst levels, but not before triggering my stop loss right on the number to stop out my 2nd half. Getting taken out on the low of the day is irritating, but this one still paid me well. I’m now out of this position with an average gain of 4.8%, a pretty decent winner during a time when the overall market remained range-bound. Volume never really confirmed the advance (as discussed last night), so I kept it tight and am pleased with the result. I’ll wait for a new pattern to emerge before considering a reentry.
Jeff, when you decide what to trade do you take into consideration the overall direction of the market and your belief in which way it is headed, or do you simply go with the patterns that you identify. For example, if you identify a stock pattern that looks good for a long trade but the market has been in a down trend, would you take the trade regardless of the overall market direction ?
I guess the bottom line of what I am asking is if you would disregard a promising pattern because the overall market direction is different ? As always, thanks in advance for your guidance.
Hey Gary!
Good to see you & I hope your weekend has been nice.
What I do is scan all the charts in search of high quality setups. I have found that when the market is trending one way, there will tend to naturally be more patterns in that same direction (uptrend = bullish patterns). However, if and when I find bearish patterns, I will still take them even if the overall market trend is up. I’m sure you have seen me take plenty of shorts over the past 9 months despite the market uptrend. So I do not try to avoid certain patterns if the market direction is different.
Sometimes those can make for great trades. For example, in a weak market, a strong stock will stand out like a sore thumb, and more traders will often gravitate to it, making for excellent conditions for a sizeable move. The same is also true with weak stocks in a strong market, as it can get hit very hard. On Friday I caught a nice move in CTCM as a day trade as it was getting punished despite the market strength (NAZ + 1.4%). So I think it can pay nicely to notice those outliers and not ignore them.
Now with that said, if the market is moving sharply in one direction, then I may take those trades in the opposite direction with smaller size, as swift market moves can definitely impact how individual names will move. But if the market is slowly trending, then I will just take what the charts offer.
Does this help?
Thanks Jeff, that was right on point and very helpful. Hope you had a good weekend and best of luck trading this week.