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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

Thursday, May 21, 2009

CNBC is in Nigeria.. Invest in Momar

Arron Burnett CNBC crack anchor is in Nigeria touting investment opportunities in Africa. Africa is tied to commodities. They are touting commodities. I remember in 2005 when they were in Miami talking about real estate going bonkers and when they were in Dubai last year touting the new center of the corporate world.Remember they were building a copy of the world in the gulf. Now they are in Nigeria, the oil producer, touting commodities. That one also made 60 minutes. Stop it you"re killing me!!! Cramer is recomending AFK 25.14 for Africa play How timely.....

GM chugging away now at 1.65 but the board sold out and the stock is only worth .02 remember?

GM now 1.91..My guess is that it goes to about 2.20 on this move before it consolidates
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