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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

Monday, March 29, 2010

The Farce continues

DJIA10895.96 +45.67 SPX 1165.52 -.02 Russ2000 678.84 -.34 NASDAQ 2393.50 -3.66 VIX 18.14 -.26

Dollar Index 81.62 unch Aussie 91.67 Euro 1.3488 +.0024
TLT(20yrGov Bonds)88.85 -.10 IEF (7-10Gov Bonds)89.16 -.17

XLK (Tech)23.15 +.15 XLE (Oil Index)57.21 +1.13 XLF (Finan Index)16.07 +.07 KRE (Regional Bank index) 26.21 XHB Homebuilders Index)16.98 +.02 GDX (Gold Miners Index)44.29 +.57 XLB (BasicMatIndex) 33.99 +.31 XRT (Retail Index 41.59 -.07 IYR (Real Estate index) 50.27 +.16

EEM(Emerging Markets) 41.83 +.73 FXI(China Index)41.75 +.92 IEV(Europe350)38.26 +.36 (Brazil)72.58 +2.14

DBC (Commodity Index)23.48 +.51 Gold 1110 -.30 Silver 17.36 -.22 Copper 3.53 -.035 RBOB (Whsl Gas)2.26 unch Nat Gas 3.898 -.018



A farce is a comedy which aims to entertain the audience by means of unlikely, extravagant, and improbable situations, disguise and mistake. To call this a recovery is a farce of the highest order.

Gold has reversed its sell off below 1100 and stocks have continued their relentless uptrend. I have not received a sell signal on the market and the dollar has weakened. This all indicates to me that the Fed is still pouring liquidity into the markets and their minions are still talking about a V recovery and a bull market.

The shorts have got to be blown away by now and like I said the buyers will come into every sell off. I think they feel that Uncle Sugar will be there for them and right now he sure is. Meanwhile, the common folk continue to struggle and in the end it will be about them.

The March employment numbers are coming on Friday. The talk is that the numbers will show improvement. I am sure the boys will make up some good numbers for us. The question is will the market keep going up after those good numbers?

My reversal price is a close below 10700. I have dropped that from the 10834 from last week. A good signal would come on a good employment number and a close below 10700 and Gold closes BELOW 1060. A strong jobs report might do the trick. If both happen I would have my signal.

Mikey
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