$SPY #Options #DayTrade – recent tweets

Keeping up, up with the #Nifty50StockList

Updates for this past week’s upswing are in this link:

The 50 Stocks rise as the NYMO/NYSI turns up

The Strategy

Again and again, my nifty-50 stock list moves from oversold to overbought and back again to oversold like an ever spinning wheel within the market’s spinning wheel…

And each time there are 40 or more of the 50 stocks on sells, it’s time to sit up and take notice since that is the number that most often signals either the bottom or the beginning of a bottom on each down swing.

I first posted about this strategy in November of 2015 on another forum.

Nothing has changed since then.

Usually it just takes one day of 40 sells, sometimes two days, to set up the bottom of a swing. Should be noted if it goes more than two days that’s is a warning that something bigger may be in the offing (last time that happened was the start of the Covid-19 bear plunge this year).

This is just an FYI since the signal is once again close by.

This is what market timing and swing trading are all about.

The results can be quite remarkable, in leveraged ETFs like TQQQ, TNA, leveraged sector ETFs like SOXL, FNGU, and, of course, hot individual stocks.

The purple marking on this chart are each time there were 40 or more of the Nifty-50 on sells.

$AFRM – from “hot” to “hotter” UPDATE

AFRM from hot to chop to hot again…

(CLICK ON TWEET TO SEE FULL CHART)

1/14/2021

AFRM had its debut in trading yesterday.

As per the Buying IPOs For Dummies strategy the high of its IPO day at 103 was the trigger to buy the stock. It triggered on the today’s open. In day trading on a pullback, there was a intra-day buy at 107.80. That is the day-trade entry and could be the long-term entry for investors if one is a holder instead in a trader.

The stock has been as high as 139.98 today.

The stop as of this writing, is either at breakeven for the day trade or on a break of 103 long term as per the IPO strategy.

(CLICK ON TWEET TO BRING UP VIEW OF THE CHART)

#SwingTrading – “Buy when the market tells you…”

Kennedy Gammage, the late great market timer, used to say “Buy when the market tells you, sell when the stock tells you.”

He could just as easily said “buy when the market tells you AND when the stock tells you.”

That is what this story is about.

Mr. Gammage’s market tools were the McClellan Oscillator ($NYMO) and the McClellan Sumation Index ($NYSI). The NYMO is a short term market-breadth indicator based on the New York Stock Exchange Advance/Decline line, and the NYSI is its longer-term brother.

Taken together, they are the clearest indication of mass market psychology which is to say: market direction, up or down.

When the NYMO and NYSI rise, it is time to buy stocks, ETFs, calls, futures, whatever money-maker one likes best.

That is the market telling you to buy…simple as that, and do not argue.

Now throw in my nifty-50-stock list (see its own story below) as it moves, again and again, from oversold to overbought and back again.

Each time there are 40 or more of the 50 stocks on sells, it’s time to sit up and take notice since that is the number that most often signals either the bottom or the beginning of a bottom on each down swing.

Once 40 more sells have registered on the list, it is time to take note of the NYMO to get market direction to trigger the buy, or if longer-term breadth, measured by the NYSI, is rising when 40 or more sells register on the list that is to time as they say in the market to “buy the dip” in an on-going up trend.

This is what market timing and swing trading are all about and the returns can be both rapid and remarkable.

#MarketTiming the #ShortList

#MarketTiming swing bottoms with 40 plus sells on the #Nifty50StockList

Again and again, my nifty-50 stock list moves from oversold to overbought and back again to oversold like an ever spinning wheel within the market’s spinning wheel…

And each time there are 40 or more of the 50 stocks on sells, it’s time to sit up and take notice since that is the number that most often signals either the bottom or the beginning of a bottom on each down swing.

I first posted about this strategy in November of 2015, one of the first entries on this blog.

Nothing has changed.

Usually it just takes one day of 40 sells, sometimes two days, to set up the bottom of a swing. Should be noted if it goes more than two days that’s is a warning that something bigger may be in the offing (last time that happened was the start of the Covid-19 bear plunge this year).

This is just an FYI, but it is what market timing and swing trading are all about.

The results can be quite remarkable, in leveraged ETFs like TQQQ, TNA, leveraged sector ETFs like SOXL, FNGU, and, of course, hot individual stocks.

The buy signal is the open of the first day after the Nifty50StockList ceases to have 40 or more stocks on sells. Stops are at whatever price level on whatever is bought based on each trader’s risk tolerance.

On the chart below the 40-plus sells are marked with purple paint bars.

(click on the chart for a larger view)

#MarketTiming the #Nifty50StockList – Marking progress in $QDEL

Today, a look a back at the swing signal and upswing in QDEL, number 25 on the Nifty-50 stock list.

Up 27% since the swing signal in an oversold list since the buy on the open 9/09, 13 trading days ago.

#MarketTiming the #ShortList – Stocks UPDATED

The obvious stock sectors that are no-brainers for shorting largely because Covid-19 has put them either out of business for the immediate future or has severely hampered profit prospects for this year.

The most obvious are the cruise companies – NCLH, CCL, RCL – since it’s going to be a long time before they can pack a liner with either customers and crews. And now several of the key destinations have so enjoyed being tourist free there is talk they are not even going to allow the ships to dock and disgorge passengers like they were doing before the pandemic.

Next on the list movie theaters – AMC, CNK – since even if they open with social distancing they will at reduced audience capacity. Can they make profits on half a house or less?

It’s the same in the airline sector – AAL, UAL, DAL, LUV – less flights, less passengers, more trouble with the virus every hour of the day. Throw with BA too. No need to buy passenger planes when there are so few passengers and you have a fleet of excess airliners in storage.

Banks are on the short list too — JPM, GS, BAC, C, WFC – largely because they have lagged the rally from the March low for too long. That spells trouble not only for the sector but for the market as a whole. If the economy is going to tank and take the stock market with it (any day, week, or month now), it’ll probably, seriously, start the drop in the banks.

UPDATE: Am adding YELP and TRIP to the list. Without as much to review as they had before the pandemic, they have diminished prospects for the near term and maybe longer.

Coal stocks – BTU, ARCH, SXC, CNX – on the short list because the coal sector is always a short. It is not the fuel of the future and is becoming more and more not the fuel of the present. If ever there is a sector for swing traders to short every bounce this is it.

In the $BLNK of the an eye, 40% and 12.6%

On my last swing buy signal $BLNK, a company in the business of providing charging stations for electric vehicles. You know, things like those posts in parking garages and any where else something like a Tesla might pull in for a recharge.

I’m not one to get into fundamentals but it seems to me BLNK is a baby with a whole world and all of its life ahead of it.

If one is so inclined to peruse the fundamentals there is this at BARCHART.COM.

Anyway…

Since my last swing buy on stocks, ten trading days ago, BLNK is up 40% (see the chart at the bottom of this post below). Since I tweeted this on its run out a Darvas Box it is up 12.6% from the open three days ago.

As some market guru might say — “Sprightly.”


AT THE CLOSE TODAY (9/22):

(click on the chart for a larger view)

$SPY #Options #DayTrading – FED CALLS an hour rally, then it’s all ka-PUTS

Today was a Federal Reserve open market pronouncement day. Pretty much as expected, no change in rates and no likely raise of rates at any time in the future.

One would think that’s pretty bullish, and it was for an about an hour (see the CALLS chart below), but like a lot rally days recently there’s a sell-off into the close (see the PUTS chart below).

When the market doesn’t charge ahead on so-called good news, it is not good news and it could turn bad in a hurry.

FIRST OPTION PLAY: THE CALLS

SECOND OPTIONS PLAY: THE PUTS

A SIDE NOTE ON THE PUTS PLAY:

Had that stayed with the initial breakeven and held to the close the second half would have been up around 130%. Them’s the breaks.

(click on the chart for a larger view)