Posting Times

Posts will be between 8:30 PM to 10:00 PM PST
Mikey's Short Term Trading Rules

1) Make up a list of stocks, commodities or ETF's to trade. This list should be names that have good earnings and high relative strength.
2) Monitor this list and throw out the weaker names
3) Buy only stocks or ETF's that are intermediate and daily up (green) and the market is Daily and intermediate term up (green)
4) Buy pullbacks on these stocks to the 20 and 50 day averages
Usually you get 4 to 6 20 day pullback buys and 2 or 3 50 day pullback buys in an intermediate term trend
5) More agressive traders can buy the 7 day average in the first 3 to 8 weeks of the uptrend.
6) Buy pullbacks not runups. A buy should not be easy or exciting but difficult and somewhat scary. DO NOT CHASE
7) Place stop at 5% below the buy price. Do not remove
8) Sell 3 to 5 days after the stock price takes out its most recent 2 week high with at least 15% gains
9) Uptrends that are 12 weeks or more may be ripe for a correction. The first 2 pullbacks to the 50 day are usually safe.
Intermediate term uptrends and downtrends generally last from 8 to 16 weeks with 12 weeks being the norm.
10) Shorting is a viable strategy in downtrends for experienced traders only. In general, reverse the above rules
11) Tweet Mikey @themarketshadow with questions or ideas

Tuesday, October 28, 2008

The Rocket is being fueled..they say it won't fly

The market is like a rocket that is on the launching pad that is being loaded with high powered rocket fuel. The fuel is lower interest rates, lower commoditiy prices, and massive injections of capitial by the central banks. Look at this:

Fifteen U.S. banks have signed up for the government's offer of a cash injection, in addition to the nine that joined the program initially. The injections are a bid to revive the sector, which has suffered since lending has dried up and many loans have gone bad.

The Treasury Department plans to provide funds for 20 to 22 lenders in the current round of a $250 billion bank recapitalization program.

Nine of the largest U.S. banks, including JPMorgan Chase [JPM 34.00 --- UNCH (0) ] and Citigroup [C 11.73 --- UNCH (0) ], received the first $125 billion of capital infusions two weeks ago.

A list of the additional 15 banks that have announced they will use the government funds follows:

PNC Financial Services [PNC 58.63 --- UNCH (0) ] $7.7 billion
Capital One Financial [COF 34.40 --- UNCH (0) ] $3.55 billion
Regions Financial [RF 9.95 --- UNCH (0) ] $3.5 billion
SunTrust Banks [STI 35.34 --- UNCH (0) ] $3.5 billion
KeyCorp [KEY 9.92 --- UNCH (0) ] $2.5 billion
Comerica [CMA 25.80 --- UNCH (0) ]$2.25 billion
State Street [STT 35.69 --- UNCH (0) ] $2.0 billion
Northern Trust [NTRS 49.68 --- UNCH (0) ] $1.5 billion
Huntington Bancshares [HBAN 9.17 --- UNCH (0) ] $1.4 billion
First Horizon National [FHN 9.58 --- UNCH (0) ] $866 million
City National [CYN 46.88 --- UNCH (0) ] $395 million
Valley National Bancorp [VLY 15.44 --- UNCH (0) ] $330 million
UCBH [UCBH 4.59 --- UNCH (0) ] $298 million
Washington Federal [WFSL 15.34 --- UNCH (0) ] $200 million
First Niagara Financial [FNFG 13.87 --- UNCH (0) ] $186 million

But look what the experts say..you know the guys on TV ...

Most banks that signed on to the government's recapitalization program surged on Monday, but market pros are still advising caution when it comes to putting the stocks in your portfolio.
Having more cash on hand makes the banks more solvent, but underlying problems in the industry are still raising hackles in the investment world.

What they are saying is that is is not going to work. Well those are the same guys that for the last 2 years said that higher interest rates would not slow the US consumer and slow the raging World economy. Guess what they are wrong again!
Posted by at

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)