Okay, so I took a couple of days off to regroup after some setbacks. I have played my very first "Iron Condor" on the $NDX which I am excited about. When I master this technique, I will be able to generate steady income every month with limited risk. If you want to learn more about how to play this, you need to be an INVESTools student. My anticipated income off this trade is almost 5 figures, which when generated every month, will give me well over 40% return over the year. I'll keep you posted.
The Fed speaks today, and everyone expects them to stay status quo and do nothing. This would be quite Bullish and may give early kindling to a 4th quarter Bull rally, which is what I am waiting for...some solid direction in the market.
Meanwhile, oil and natural gas are getting hammered as are other commodities which may make for some very good buying opportunities. If the Fed does keep interest rates stable, even though Housing may have fallen off a cliff, it may also be a good time to get into those as well as Retail.
Cheaper Oil, No Interest Rate Hike = Weight Loss?!?!
So check this out, NTRI, which I made a lot of money on the upside a few months ago has been downtrending recently. The stock was falling away from it diagonal resistance and the MACD and STO looked perfect for a Put yesterday. then today, WHAMMO, a complete 180. The stock is up almost $4.20 today on no news, just speculation I guess that since oil is falling, and the Fed may pause again, that folks will spend money on weight loss products. Funny logic. I got out quick on this cause it smelled fishy and I didn't want to take a bath on this nonsense, so once it pierced the diagonal resistance I line, I said "Aloha."
Wednesday, September 20, 2006
Thursday, September 14, 2006
What the Hell?!?!
Ever think the market is even more confused than you are? Well, check out these two headlines on Yahoo! finance. One says that the market "looked past an unexpected rise in retail sales" and the headline right below it says "Retail Sales Slow." So which is it dumbasses?
Meanwhile, the oil sector continues to get hammered because of what I perceive as an "International Lovefest" since Israel isn't blowing up Hezbollah to Kingdom Come, and Iran is supposedly "playing nice," and Nigeria only had 3 kidnappings this week instead of 4. Meanwhile, there are still hurricanes forming in the Atlantic; Iran, Venezuela, and Nigeria are still hotspots and unstable, and China and India are making cars that I assume the 2 BILLION people that live there (okay, maybe only 400,000,000 will actually drive them) will buy and fuel, the oil "finding" in the Gulf is still years away from being tapped into, and is in the same place that hurricanes love to roam. So what is it? Is the "terror premium" all of a sudden irrelevent because the World is fairly quiet? Look out if we get a very cold winter and a hurricane makes its way into the Gulf (remember, Hurricane season ends in NOV).
I will be very happy once tomorrow is over, the "Witch" will be dead and hopefully we can resume some normalcy.
Happy trading!
Tuesday, September 12, 2006
Triple Witching Week
Well Traders, it's "Triple Witching Week" which means the markets are even more irrational than usual. Usually, I sit on the sidelines this week because being that it is Options Week, as well as the end of Q3, there is so much happening with the Mutual Funds and Hedge Funds that I let those guys battle it out.
The Dow had a big run up today, but as I looked at the MACD, the peaks have been lower with each higher peak on the daily price charts. This is a called a "divergence" and usually symbolizes a "false rally." So, being that the Dow is getting very close to the all-time high, it could be a predictor of a fall-back...time will tell.
CVS got taken out yesterday when the stock had an ealy morning fall, but I still made a 5o% return on the option after moving the stop-loss up. I'll take 50% returns ALL DAY, EVERY DAY!
JCP has finally got some steam behind it and has had three consecutive up days with decent and increasing volume, so that bodes well for my Call play on the bounce of 9/1. I was concerned when the stock fell back, but it did not break my support line so I stayed the course. Today, I was rewarded with a nice move and a close above the 30 day MA, which is nice as that can act as support now. My 1st target price for the stock is $69.50, which is the neckline for an Ascending Triangle play. Should the stock break that resistance level, I see a $7-$8 move from there. Wouldn't THAT be cool?
Finally, for consideration look at LH. The stock is bouncing off the MA, and the MACD and STO are perfectly positioned for a nice upside move. 1st target for the stock price is $69.25 with a 2nd target of $70.25. If it breaks $70.25, I seesomewhere above $73. Notice the Bollinger Bands are getting close to a nice squeeze which may indicate a substantial breakout.
Happy Trading!
The Dow had a big run up today, but as I looked at the MACD, the peaks have been lower with each higher peak on the daily price charts. This is a called a "divergence" and usually symbolizes a "false rally." So, being that the Dow is getting very close to the all-time high, it could be a predictor of a fall-back...time will tell.
CVS got taken out yesterday when the stock had an ealy morning fall, but I still made a 5o% return on the option after moving the stop-loss up. I'll take 50% returns ALL DAY, EVERY DAY!
JCP has finally got some steam behind it and has had three consecutive up days with decent and increasing volume, so that bodes well for my Call play on the bounce of 9/1. I was concerned when the stock fell back, but it did not break my support line so I stayed the course. Today, I was rewarded with a nice move and a close above the 30 day MA, which is nice as that can act as support now. My 1st target price for the stock is $69.50, which is the neckline for an Ascending Triangle play. Should the stock break that resistance level, I see a $7-$8 move from there. Wouldn't THAT be cool?
Finally, for consideration look at LH. The stock is bouncing off the MA, and the MACD and STO are perfectly positioned for a nice upside move. 1st target for the stock price is $69.25 with a 2nd target of $70.25. If it breaks $70.25, I seesomewhere above $73. Notice the Bollinger Bands are getting close to a nice squeeze which may indicate a substantial breakout.
Happy Trading!
Sunday, September 10, 2006
Back into the fray...
Well, last week ended a bit sour. Some of my positions were taken out for some losses based on support/resistance levels being broken. I have set my stop loss exits to be more "aggressive," i.e bailing out earlier when the trades go against me.
NEU is a good example. The stock had broken above a resistance neckline for a Head & Shoulders play that was projected to have a $25 upside. However, the very next day, the stock dropped over $3 at one point, dropping back below the neckline at which point I exited the trade with my preset stop-loss trigger. I always have TWO stop loss triggers set on each trade, a standard 30% loss exit, as well as a support/resistance level trigger that may or may not take me out before the 30% trigger. The 30% trigger is my Max Pain exit, so that is the most I expect to lose on a trade, and the support/resistance trigger may take me out before the 30% loss which is fine too.
I stepped back from trading on Friday since I was taking some hits and to stop from getting "emotional," but I expect to make some trades this week if any present themselves.
I have a very nice trade going with CVS, which I am up over 40% right now. I have moved my stop-loss up to capture 35% returns so I am a happy camper right now. I expect the stock to reach about $36.50-$37 within the next 10 days at which point, if the stock begins to retrace abck to its diagonal support, I'll get out and wait for the stock to retrace to support and get back in again.
Happy trading!
NEU is a good example. The stock had broken above a resistance neckline for a Head & Shoulders play that was projected to have a $25 upside. However, the very next day, the stock dropped over $3 at one point, dropping back below the neckline at which point I exited the trade with my preset stop-loss trigger. I always have TWO stop loss triggers set on each trade, a standard 30% loss exit, as well as a support/resistance level trigger that may or may not take me out before the 30% trigger. The 30% trigger is my Max Pain exit, so that is the most I expect to lose on a trade, and the support/resistance trigger may take me out before the 30% loss which is fine too.
I stepped back from trading on Friday since I was taking some hits and to stop from getting "emotional," but I expect to make some trades this week if any present themselves.
I have a very nice trade going with CVS, which I am up over 40% right now. I have moved my stop-loss up to capture 35% returns so I am a happy camper right now. I expect the stock to reach about $36.50-$37 within the next 10 days at which point, if the stock begins to retrace abck to its diagonal support, I'll get out and wait for the stock to retrace to support and get back in again.
Happy trading!
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