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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, December 17, 2009

Gold Stocks break..Plays catchup with falling Euro...The Stock Market is next!!

DJIA 10314 -126 SPX 1096 -13.03 VIX 22.42 +1.88 Gold 1106 -29.70 Silver 17.189 -.50Oil 72.62 --.93 RBOB (Whsl Gasoline)1.8345 -.0394 Dollar Index 78.22 +.86 EURO 1.4310 -.027 TLT (Long Term Gov Bonds)82.85 +1.17 IEF (7-10 Yr Gov Bonds)91.04 +.66 XLK (Tech)22.08 -.27 XLE(Oil Index)56.39 -.24 (XLF Financials Index)14.11 -.22 XHB (Homebuilders Index)14.84 -.025 EEM (Emerging Markets)40.30 -1.14 FXI (China Index)41.84 -1.10 GDX (Gold Miners Index)45.75 -2.46



EURO (FXE) 143.10 ...The Euro has completely reversed its breakout of 9/08/09 and anyone who bought the hype of a weak dollar and bought the Euro after 9/8 is now losing.



GDX 45.75 ...Gold miners index broke out at the same time as the Euro and has reversed its breakout..after all the hype on Gold if you bought after 9/8 you are losing




Gold 1109 is lagging the GDX and Euro should go straight to 980



Oil (XLE) 56.40 has already broken and bounced back to its breakdown at 57. I say it rolls over now from here. Look at the charts on JPM and GS that I posted on Tues 12/14. They broke and rallied back to their breakdown on 11/11 and then rolled over. They are our leaders



China(FXI) 41.88 looks identical to the rest and is back below its 9/8 breakout



The The Emerging Markets (EEM) 40.41 is just starting to break





THE STOCK MARKET IS THE NEXT ONE TO GO

DJIA 10335



I am raising my sell signal on the stock market to 10300...more to follow. My guess is that the first sell off should be to around the 9800 area..a bounce and then to 8900...Tomorrow is options expiration's day

Notes...Visa (V) 85.82 looks really ripe here
Mikey
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