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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

Monday, March 23, 2009

Inflationary????? Not now Gold Bugs

Gold 936.80

It will take 3 to 5 years for this pump to go through the system. The Fed is trying to prevent deflation now. This is the flip of 1979 to 1981 when the Fed raised interest rates to stop inflation. The Bonds did not take off until 1985. I remember begging people to buy bonds in 1984 but they wanted to be in money market funds. If I was in the business I would be begging them to buy stocks and guess what they are in money market funds again. Why? The news is bad don't you know and the experts of the world are says be safe now.

Anyway I digress the fact is that the Gold Bugs are going to get their ass handed to them and it ain't that far off. Nighty night Gold Bugs when you wake up the world will not be coming to an end..The beat goes on..... Mikey
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