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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 15, 2009

They are looking at the 200 day..What Mikey will do

Charts Predict: S&P Rally is Hitting a Ceiling

DJIA 8375 +44.21 SPX 894.56 VIX 30.91 -.46 Gold 929.70+1.30 Oil 58.17-.45 Dollar Ind 82.47 +.10
The recent rally in the S&P 500 could be over as the index is struggling to break above a key resistance level, Royce Tostrams, technical analyst from Tostrams Groep, told CNBC.

“The market is running into its falling 200-day moving average and that normally suggests limited upside potential,” Tostrams said.
The S&P's [.SPX 889.6 -3.47 (-0.39%) ] rising trend does appear to be in tact in the short-term, however, Tostrams told CNBC. But “there’s a lot of overhead resistance in New York (and) the rally is running out of steam,” he added.

If the index does manage to break above its falling 200-day moving average it could rise above 1,000 points, according to Tostrams.


This is what I was talking about the last 2 days. They all think we are going to correct now and the market has run out of steam. Notice that his "expert" says that we are bumping up against the 200 day average on the S&P (SPX). That average is now at 945. He says that if we break above that average we could rise above 1000. I think before this is over it will do that. You should hear all the "experts saying we broke above the 200 day and give the all clear. What I am listening for is the all clear to sell out.

In other words, at some point before this rally is over it will look like it is going to the moon and the Tostrams of the world will buy into it. That will be a good time to get out......Mikey


Notic thatnthey are letting the air out of the puts now.....VIX at 30.91
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