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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, February 24, 2009

Pros say Gold to 3000 and Short the banks...Mikey says Gold to 400 buy the banks

Major U.S. Indexes.DJIA7280.21165.43+2.33%1,306,375,000.
NCOMP1422.8935.17+2.53%524,363,900.
SPX765.0121.68+2.92%3,623,952,300
Gold 969.10 -25.90
Oil 39.41 +.97
Dollar Index 87.05 -.37

Stocks ticked higher Tuesday, bouncing off a 12-year low on Monday, as investors scooped up bargains and bank stocks bounced back.

This came after stocks dropped more than 3 percent on Monday, ending at levels not seen since May 1997.

Federal Reserve Chairman Ben Bernanke said the economy is suffering through a "severe contraction" and pledged to use all available tools to lift the country out of the recession, in testimony before the Senate Banking Committee.

Later, President Obama will address a joint session of Congress to outline his budget plan.

In economic news, home prices continued to post record declines. Prices of single-family homes dropped 18.5 percent in December from a year earlier, according to an S&P/Case-Shiller home-price index.

And consumer confidence plunged to a record low in February. The Conference Board's confidence index dropped to 25 from a downwardly revised 37.4 in January. Economists had expected a more mild drop to 35.5.


Citigroup [C 2.45 0.31 (+14.49%) ], the subject of intense speculation on whether the government will take a major interest in the troubled bank, saw its shares gain more than 5 percent, adding to Monday's 10-percent gain. This came after Citi ended last week at its lowest level since January 1991.

>> Would 40% in Citigroup Be Enough?

Citi CEO Richard Parsons met Monday night with Valerie Jarrett, a top aide to President Obama, intensifying speculation of the government's interest in helping Citi, Politico reported on its Web site.

Shares of Bank of America [BAC 4.55 0.64 (+16.37%) ] and JPMorgan [JPM 20.64 1.13 (+5.8%) ] also advanced.

For Investors:

Pros Say: Gold to Spike to $3,000
Shorting Prospects in Western Banks
Rising-Star Stock: Energy

Mikey Says: I threw that for investors as an added bonus. 3000 Gold? Shorting banks?
I love it. The beat goeson...Mikey
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