$SBGL (TRADE UPDATE) – up 9.4% in 4 days…

SBGL, long from 11/21 at 5.09, has had a nice four day run to the upside to close-by resistance.

SBGL – START OF THE TRADE

At the same time the leveraged gold-stock ETF, NUGT, has move up to the top of its recent range (see the chart below). Would like to see a breakout in order to take SBGL above 5.65. It closed today at 5.57.

In the meantime, moving the stop on half the position to 5.42, and to breakeven on the other half.

(click on the chart for a larger view)

#MarketTiming – Swing signals positive for stock buys

All of the swing signals – based on Price, Breadth and Volatility – are on buys and even the all important long-term breadth is threatening to go positive.

It would appear we are entering a seasonally positive time.

On a stock trading note: four of the 10 stocks in my bellwether stock list have a good chance, if the market rallies as is likely Tuesday, of following the market:
NFLX
NVDA
BID
FSLR

See the positive candles today on each of those stocks on the chart panel below. Like the stock market itself, expect stocks that are up to follow-through and go up until they don’t. And, of course, if the market rallies it is also likely AAPL will again participate (always good for a bounce, a scalp, or an option-play).

SWING TRADING SIGNALS:

LONG-TERM BREADTH: Sell (Day 20).

PRICE: Buy. (Day 1).
SHORT-TERM BREADTH: Buy. (Day 3).
VOLATILITY: Buy, (Day 3).

CONTEXT:

SPY CLOSE – 258.30
QQQ CLOSE – 153.87
CNN MONEY’S FEAR AND GREED INDEX: (50, rising, neutral level).
NIFTY-50 STOCK LIST: 35 Buys; 16 Overbought, 6 Oversold, 1 new buys today, 6 new sells.

(click on the chart for a larger view)

$SBGL – Sell no stock before its time…

Let’s just call it the Everready Bunny of the gold stocks.

SBGL just keeps going and going and going.

In the time SBGL has been staging its own rally, GDX, the main ETF in the sector, is down 1.2% — DOWN! The 3x-leveraged ETF NUGT is down 6.6% – DOWN A LOT! The biggie gold miner, ABX, Barrick Gold Corp, is down 13.3% – DOWN A LOT A LOT!

And SBGL is up 26% on the same time frame from:

WHEN IT BEGAN 9/28

But I’m here to confess to an obvious mistake and to sing a trader’s lament.

I sold half the position in this stock when it was up a “mere” 16 percent on a sell signal that…uh…didn’t exist. At the time, I must have thought it could go no higher although I’ve often said that this is the stock to buy among the golds because it has been “wild and crazy” enough to double. I must have thought the doji the day before I sold was a sign of the indecision that would lead to a sell down although the stock was up the day after the doji when I sold that half. I must have thought…

Clearly now, I think I was thinking too much. Which is one of biggest sins a technical trader can make. Better to not think at all.

Fortunately, I just sold half. So with this half up 26% and the half sold at 16%, the trade is still up 21% on the close today. Not bad but not 26. So next time…next time…

Ah, I don’t even want to think about it.

(click on the chart for a larger view)

$SBGL – Updating the hold on the gold stock…

It’s been a long, slow slog since the buy signal on the open of 9/29, nearly a month ago, but SBGL, the little gold stock that sometimes goes nuts (meaning it can double on a swing), is still slogging to the upside.

This is an update of this post:

Divergences don’t matter until they do Part II

SBGL is up 14-plus percent despite sell offs this month in GDX, NUGT, and JNUG.

Still long (it can still double…), but moving stops to insure a profit.

(Click on the chart for a larger view)

$SBGL – Divergences don’t matter until they do Part II

It’s time to try wild and crazy SBGL again. Probably the entire sector of gold stocks for that matter…

Last time this stock traded it yielded a great gain. And now it has fallen all the way back to where the last rally began. Who says the trend is your friend? Not as much sometimes as the swing.

Divergences don’t matter until they do Part I

So what to do now?

It’s a buy now with a tight stop. Thurday’s low? Wednesday’s low? Depends on the individual trader. Last time was stopped out twice for small losses before grabbing the big gain.

In addition according to YAHOO FINANCE the stock is currently pay a whopping 8.9% dividend, which makes a candidate for a buy-and-hold if an initial swing can give enough of a profit cushion for a safe investment.

To see the divergence, check the lower graph on the chart below.

(click on the chart for a larger view)

$AAPL – the stock that is the market…

The story of an otherwise lackluster consolidation day was AAPL’s event to announce its new iPhone, TV stuff and the latest edition of its watch.

Almost any day in the market is an AAPL day since the the stock is so big (an unprecedented $830 billion market cap) that is shakes and rattles every index it is in.

So today started out with the stock gaping up and immediately selling down, taking the Nasdaq with it.  It then chop-choped back up to its high of the day as its event opened.  There is a common saying the stock market that goes “buy the rumor, sell the news.”  Well, the traders indeed sold the news, taking the stock down two points into the close.

See the charts below.

For day traders that was just fine.  AAPL’s news was worth 40% in its in-the-money puts from the open of its “event” to the close of the market, 80% at the greatest measure of its tank from its high on the news. If one shorted its “news” in the stock itself, it would have been worth two points to the close. Five-hundred shares and one could actually afford their over-priced phone. A thousand shares one could buy two and give the second one to your kid.

To your kid! A thousand-dollar phone! You must be kidding!

And P.S.: that was supposedly good news.

So what now?

AAPL had an “outside day” which is a continuation pattern in technical analysis and since the stock came into the day on an upswing it is likely to recover today’s small drop and continue higher.  Especially since it has enough cash on hand and the prospect of a lot more to buy its own stock.

As for the general market all three of my swing signals remain on buys, and long-term breadth is accelerating somewhat to the upside so there is more rally to come.

SWING TRADING SIGNALS:

PRICE: Buy. (Day 2).
SHORT-TERM BREADTH: Buy. (Day 2).
VOLATILITY: Buy, (Day 2).

CONTEXT:

LONG-TERM BREADTH: Buy(Day 12).
CNN MONEY’S FEAR AND GREED INDEX: (64 rising, entering greed level).
NIFTY-50 STOCK LIST: 31 Buys; 19 Overbought, 3 Oversold, 6 new buys today, 9 new sells.

Bellwether stocks meeting 5-minute day-trading criteria for a buy on the open:  NFLX, FSLR, BABA, BID.

(click on the chart or a larger view)

#DayTrading 5 minutes of risk on the open…

Today was a great example of the overwhelming importance of the open in day trading.

The market gapped down on the after-the-close news Monday that North Korea fired a missile over Japan.  And once again, as has so often happened in this bull market, the dip was met with buyers and the market started up almost immediately to close the day near its highs again. It hasn’t really gone anywhere in the last week or so but it’s moved up and down a lot, a perfect intraday environment for day traders.

At the end of the day Monday, two of my daily signal were on sells — short-term breadth and volatility — but the price signal was giving a buy for today’s open and long-term breadth, the most important indicator for the overall mass psychology of the market, was also positive.  Long-term breadth also — not always, but usually — makes overnight news irrelevant.  Going into the day, it wasn’t as if one could expect a home run but a single or a double might be possible.

So let’s go back to the open.

This day, as it turned out, was also great because it provided four of my bellwether stocks on individual buys for the open coming into the day — AAPL, FB, NFLX and NVDA.  The criteria for those buy signals was that each stock ended Monday above its Monday open and above a short 3-5 bar average on a 5-minute chart.  That simple.  Now this is when day-trader must have faith and believe to put in market orders to buy at the open no matter what is happening in the overnight.

How did that turn out?  Great day.

See the chart panel below.  Not one of those four stocks threatened a loss from the open to the close with AAPL up 1.68% on the trade (on the charts, the number in the white rectangle on lower right is the return per $100K), FB was up 1.39%, NFLX was up 1.92% and NVDA was up 1.26%.

When I say “threatened a loss” I mean not one of those four stocks went back through its open at any time during the day.  A close below the open is the stop loss.  The trade is initially at risk for a stop loss five minutes into the day.  That’s all.  After that the trade, if not stopped, is in profits, and can then be managed on an whole set of additional criteria – break-evens stops, trailing points or percentages stops, technical indicators like the short term average, whatever…or just letting it play out to the end of the day (like today).

It needs to be noted getting stopped after five minutes happens. Quite a lot in some markets.  There are only four things that can happen on any trade – a little loser, a little winner, a big loser, a big winner.  Can’t do anything about the little losers and little winners but one must be able to eliminate the big losers in order to get the big winners.  These first five minutes generally do that.

FYI, four more of the bellwether stocks meet the criteria for at-the-market buys on tomorrow’s open — FSLR, GS, TSLA, NVDA.

REMINDER: This information is for entertainment purposes only and should not be construed as investment or trading advice.

As for the today’s end-of-day:

SWING TRADING SIGNALS:

PRICE: Buy. (Day 2).
SHORT-TERM BREADTH: Sell. (Day 2).
VOLATILITY: Sell, (Day 2).

CONTEXT:

LONG-TERM BREADTH: Buy, (Day 3).
CNN MONEY’S FEAR AND GREED INDEX: (29 rising, at fear level).
NIFTY-50 STOCK LIST: 22 Buys; 6 Overbought, 8 Oversold, 6 new buys today, 5 new sells.

(click on the chart for a larger view)

 

 

 

 

Bellwether Trading Stocks – an introduction…

From Wikipedia:

“In the stock market, a bellwether (barometer stock in the UK) is a stock that is believed to be a leading indicator of the direction of a sector, industry or market as a whole. Bellwether stocks are often used to determine the direction in which an industry or market is headed in the short term.”

Decided to assemble a chart panel of ten bellwether stocks (see below).  While not, as defined above, necessarily leaders in the general market (although some obviously are), they are my choices for TRADING STOCKS that do move enough to be swing traded on the an daily basis, and move with enough velocity intraday to be day traded.  At the moment, the chart panel is static but could vary some in the future as market conditions dictate.

The stocks are AAPL, GS, AMZN, BID, FB, TSLA, BABA, FSLR, NFLX, and NVDA.

At this moment, the question among these stocks is can AAPL (upper left in the panel), trying to new all-time highs, hold up the entire market all by itself?

(click on the chart for a larger view – UPDATE 9/12)

A REMINDER: the information is from my personal stock-market journal and is presented here for entertainment purposes only and should not be construed at any time as direct investment advice.

$SBGL – divergences don’t matter until they do…

After being stopped out in late June, finally the Commodity Chanel Index (CCI) divergence on July 11th mattered — a buy at $4.70.

The stock has been slogging higher ever since, riding its short-term exponential moving average (see chart below).

It is challenging its down gap now.  If it can get into the gap with some conviction, the run-up could accelerate.

Original discussion posted here:

http://www.traders-talk.com/mb2/index.php?/topic/167061-the-wild-and-crazy-sbgl/?p=765640

(click on the chart for a larger view – updated 8/29)

$TSLA – #MarketTiming Stock of the day…

“Buy when the market tells you, sell when the stock tells you.”

That is a stock-market adage coined, I believe, by the late great Kennedy Gammage of the Richland Report.

The first part of that quote is always the timing trigger to enter any long in the market, having the breadth, the mass psychology of the general market, positive to reduce the initial risk of any trade and/or investment.

That is what market timing is all about.

The second part of the quote is about time.  If one is a trader, the decision might be to exit any trade when the market turns negative.  Even for one day.  If one is an investor, the decision would be to hold the stock until is reverses, or hits a stop loss level, or violates a trend line or violates a moving average, or any number of other indicators that could cause the stock to tell sell.  Each of those stock exits are up to the individual investor’s risk tolerance or profit motive.

Applying the adage is rather simple which is why Mr. Gammage was great.

The stock of TSLA (see the chart panels below) is a perfect example today of how this works.  My three swing trading signals were all on buy signals indicating a positive market for at least a day trade. TSLA finished the day yesterday on an intra-day buy signal of its own that would carry over to today’s open (see right chart panel below).  In addition, TSLA was oversold on the close yesterday (the cyan color coding in the panel on the left).

That was the set up for a buy on the open today – the result a 4 percent gain on the close.

So what now?  Today’s market environment has weakened as two end-of-the-day signals, price and volatility, have given sells.   While the short-term breadth signal continues to climb (for a dicey fourth day in a row), long-term breadth is still negative.  Long-term breadth is always the context for trend trading (or for counter-trend trading like TSLA today).  So going into tomorrow the trend is down with two out of three daily signals once again in agreement making the market play again to be flat or to be short.

SWING TRADING SIGNALS:

PRICE: Sell. (Day 1).
SHORT-TERM BREADTH: Buy. (Day 4).
VOLATILITY: Sell, (Day 2).

CONTEXT:

LONG-TERM BREADTH: Sell (Day 16).
CNN MONEY’S FEAR AND GREED INDEX: (19 falling, extreme fear).
NIFTY-50 STOCK LIST: 28 Buys falling; 17 Overbought, 4 Oversold, 4 new buys today, 9 new sells.

(click on the chart for a larger view)