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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

Wednesday, November 4, 2009

Days like today are the reason I write this blog

Today the market is up in advance of the FED decision on interest rates. Their main story is that the FED is pumping so much money into the system that were are going to have a growing economy and inflation. Nothing could be furthur from the truth but you will not here the other side of that story.

I write my blog to tell the other side. There is not enough common ground between me and the public to get them to believe my side but at least some one is warning the public of the problems to come. I know that only a small group will be helped by this blog but at least that is something and this blog allows me a forum to shine the light on these crooks.

Capitalism is a process were assets are accumulated by the insiders and distributed to the public. The way you know when something is being distrubuted is by the amount of noise the financial press makes on a subject. The process takes time and the price movements are overwellingly relentless to back up that story. When they are finished they pull the plug...Remember Real Estate and Oil.

More on this tomarrow
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