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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

Friday, May 22, 2009

AAA Staus of US Debt is a Hook, Don't believe it!!!!

Gold 957 +6.30 Oil 61.07 +.02 Dollar Index 79.95 -.69

How perfect for this news to break just as the Dollar makes a 6 month low and Oil "soars: though 60. It all seems so easy now . Short the Bonds buy Gold short the dollar buy commodities. THIS IS A SETUP DON'T BELIEVE IT!!!!

THIS IS A SETUP It is the hook that sets up the shorts to cover Gold, sell the dollar, and blow out the bonds they bought late last year.

To make money you have to spot a setup. This here we go that validates the story always happens at the end. There is always a debate at the end and the one that wins the debate with price ...loses. Well the Dollar, Bonds lost. I will now let the Gold bugs party now and declare victory but a close below 880 seals their fate.

I still have not pulled the trigger on the GLL 14.46 or the SCO 22.46 or the EUO 19.89 but am getting close
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