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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, May 20, 2010

THIS IS INFLATION????

Remember inflation and the Fed printing all those dollars. Take a look at these charts:


The Fed Printing???? This is the dollar index


Crude oil is dropping



CRB the commodities index falling



Long rates falling...30 Yr bonds rallying



Copper The industrial metal falling



GOLD.. THE NEXT INFLATION HEDGE TO GET CLOCKED



THE DZZ(DOUBLE SHORT GOLD) IS 12.00





What has been the message and what does the public believe? They believe we are going to have inflation and they have been told and are buying inflation hedges. They have been told that the economy is recovering and that interest rates are going to rise. That is not what is happening as you can see by looking at these charts. GOLD IS NEXT.
Mikey
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