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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 8, 2009

Here come the stock offerings

DJIA 8497 SPY 92.07 VIX 31.95 Oil 57.68 Gold 913.40 -2.10 Dollar Index 83.48 -.62

Morgan Stanley, Wells Fargo Price Stock Offerings

Morgan Stanley and Wells Fargo priced the size of their common stock offerings on Friday, as they looked to raise money to fulfill capital requirements laid out by federal government's stress tests.

Morgan Stanley [MS 25.90 -1.24 (-4.57%) ] said it priced a 146 million shares of common stock to the public at $24 a share for total gross proceeds of approximately $3.5 billion, but at a discount of nearly 12 percent to its Thursday closing price.


Stress Tests: Banks Need $74.6 Billion in Capital
Goldman, M. Stanley, Others To Repay TARP Soon

The bank said on Thursday, just before federal regulators announced that it needed to boost capital by $1.8 billion, that it would sell $2 billion in stock. People familiar with the matter had told Reuters the offering was oversubscribed.

Morgan Stanley also increased the size of its senior note offering to $4 billion from $3 billion, an important vote of confidence in the bank because the debt is not guaranteed by the Federal Deposit Insurance Corp.

The oversubscribed debt offering, split evenly between 5-year and 10-year tranches, paves the way for Morgan to repay $10 billion of capital received last fall from the U.S. Treasury under the Troubled Asset Relief Program.

The five-year notes were priced at 3.90 percentage points over Treasury rates, while the 10-year notes were priced at 4.00 points over Treasuries.

The stock and debt offerings followed the public announcement of how 19 major U.S. financial institutions fared under the federal government's "stress tests.''

Separately, Wells Fargo [WFC 25.14 0.38 (+1.53%) ] said it sold a total of $7.5 billion in stock to investors Friday morning.

The bank originally planned to raise $6 billion from public investors, but then boosted the number of shares it raised in the offering. The offering priced at the top of its expected range and sold 341 million shares at $22 each, more than the 272 million shares it had originally planned.

However, the price was an 11 percent discount to the bank's closing price of $24.76 on Thursday.

The Federal Reserve told the bank Thursday it needed to increase its Tier 1 common equity by $13.7 billion by Nov. 9.

In addition to the equity offering, Wells Fargo plans to increase its Tier 1 capital through earnings and other internally generated sources.

Sold 1/2 BAC C UYG FAS yesterday AM I dont think this is a top but just raising some cash.
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