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Posts will be between 8:30 PM to 10:00 PM PST
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

Tuesday, January 25, 2011

Get ready for cheaper Gas at the pump

DJIA 11977.19 -3.33 SPX  1291.18 +.34 NASDAQ 2719.25 +1.70
DJT 5050.59 -25.93  DJU 414.58 -1.01 VIX 17.59
US Gov rates: 6 mo .173%  2 yr .6289% 10 yr 3.35 -.05 30 yr  4.49 -.06
Gold 1332.30 -12.20 Silver 26.81 -.50 Copper 4.23 -.13 Platinum 1789.30 -30.30
Oil 86.19 -1.71 RBOB 2.37 -.06 Nat Gas 4.47 -.09
Aussie .9996 -.0018  EURO 1.3628 +.0036 Pound 1.5728 -0180
USD Index 78.14 -.04 DBC 27.36 -.35
Days to option expiration: 22

Long Term Opinions:

US Bonds: Major long term top forming. .... Current trend down
Muni Markets: Rough times ahead: Current trend down
Stocks: Secondary bear market rally ending......  Current trend up 
Gold: Primary top forming crash expected.....  Current trend down
Oil : Secondary bear market rally ending..... Current Trend down 1-24
Commodities: Bear market rally ending..... Current trend up weakening
Real Estate: Bottoming ..... Current trend down
US Dollar: Major long term bottom forming .....Current Trend down 1-18
US Economy: Double dip coming .....Current trend up
Emerging Markets: Bear market rally ending..... Current trend down
Emerging Markets Debt: A disaster.... Current trend down
World economy: Current trend slowing
World political environment: Tension, aggravated
Where's Waldo: Waldo is buying Gold, Foreign Bonds and Emerging Markets.

Stock Market Trends

Mikey Short term up 12-6 11362
Mikey Intermediate Trend: Up 09/03/10 10477
Mikey Long term trend: UP 10/13/10 11052
Mikey current trend opinion: 1-21 (DJI 11871) The caution light is on for this uptrend :
IBD : 1-20 Market under pressure


Oil upside breakout 12-1-10 @87.42 USO 37.29
Gold upside breakout 9-22-10 @1283.50 GLD 123.11
Dollar Index breakdown 9-21-10 @81.17  UUP 23.52

Short Term Trading Indicators


Mikey OB/OS index (80 OB 20 OS) .89 (market very OB )
Put/Call Ratio(.6 OB 1.2 OS).72
10 day average .72
Ratio Put Premiums/Call Premium  (extremes .60/ 1.54) .
Put Premium 10 day average .
Sentiment Total Score: Put/call + premium ratio = 
10 day Sentiment Total Score: Put/call + premium ratio =
Daily-Weekly=
Williams %R 12 day -.1.93 weekly -.73
Bulls 56 Bears 20.9 Bull/Bear ratio 2.67
Mikey Thrust indicator: Daily 10 Weekly 10 (1 low, 10 max) 20
DJIA MACD 1.3304 up/Positive cross 1-18
NYSE New Highs 109 New Lows 18
NASDAQ New Highs 58 New Lows 22
NYSE Advance-Decline +224  NASDAQ Advance-Decline -118
Mikey A/D line.(from 9/17/10). NYSE 16632 NASDAQ +6362
NYSE % above 200 day ave  %

Support: 1220 SPX, 11258 DJIA Breakout 9/20
Resistance: 1305 SPX; 11867 DJIA
Downside reversal 1207 SPX, DJIA 11200, NASDAQ 2550

Comments:
12-3 MACD Positive cross
IBD market in confirmed uptrend
12-6 Power numbers turn positive
Mikey short term up
12-7 Extermely low sentiment numbers...very overbought
Possible Metals reversal
Conclusions: Upside Price trend resumes 
12-14 AD line and NH/NL do not confirm DJI new high
New lows hit a 1 month high
30 year bonds return to April lows (amid Fed buying??????)
12-15 IBD Market under pressure
12-17 Gold MACD second negative cross RSI 46
New highs, AD line non confirm new high in DJIA
Options expire
12-20 Nasdaq rallies to new high for 3rd straight day.
12-21 IBD  market in confirmed uptrend
12-27 New highs in A/D lines for both N/H N/L lagging
12-31 Negative MACD cross
1-3 New highs on averages and A/D line N/H N/L Still off Nov 4 highs
1-4 Gold drops $44 Oil 2.17 Commodities showing weakness
Market sells off on higher volume DJIA up
Dollar holds 50 day average turns up
1-7 Foreign markets showing weakness. India in a downtrend
Dollar nears intermediate reversal levels up
Bad news in Europe surfaces again
1-10 MACD Negative cross
World markets give sell signal
1-12 New highs in DJI and NASDAQ confirmd by AD Line.
1-13 New lows expand on NYSE to 111
1-14 New highs confirmed by AD line
1-18 AAPL blows away earnings
1-19 Big distribution day NYSE 1646 net declines Nasdaq 1758 net declines
1-20 Google blows away earnings estimate
1-20 IBD goes to market under pressure
1-20 AAPL selling off on big volume
1-21 Mikey Caution light is on for this uptrend
1-21 Google stocks reverse lower on big volume

 Options expire

Moving Averages

5 day 11895 Rising/Price above
20 day 11733 Rising/ Price above 
50 day 11479 Rising/Price above
200 day 10807 Rising/Price above
20 week 11239 Rising/Price above
50 week 10765 Rising/Price above
90 week 10218 Rising/Price above
200 week 10908 Flat/Price above

World Markets (Power Numbers) Ave score 44
DJIA 68 Emer Mkts 25 China 38, Brazil 27 Europe 45  Russia 51  Japan 55 Korea 42, India 32, Australia 41  Germany 56, Spain 71  UK 32
Commodities (Power Numbers)
Oil 26, Nat Gas 42, Gasoline 44,
Gold 29, Copper 28,  Silver 22, Platinum 51
Grains 41 DBC 54


Currencies (Power Numbers)
USD 39, Aussie 41 Euro 63 , Brit Pd 65, Yuan 42, Yen 66

US Industry Groups (relative strength) Ave Score 53
10 up, 20 Neutral, Downtrend 3 Score +7

Homebuilders (XHB) 58,  Real Estate (IYR) 64, Finance (XLF) 58, Insurance (IAK) 61 , Broker/Dealers ( IAI) 54, Retail (XRT) 45, Consumer Disc (XLY) 54, Telecom (IYZ) 50, Consumer Staple (XLP) 67, Health (XLV) 60, Pharma (IHE) 49, Biotech (PBE ) 43, Transports (IYT) 43 Aerospace (ITA) 74, Shipping (SEA) 31, Airlines ($XAL) 41, ,Utilities (XLU) 66 , Metals and Mining( XME) 47, Copper (COPX) 45, Nat Gas Production (FCG ) 56, Oil Expl and Prod (IEO)56 Oil Service (OIH) 58,  Coal (KOL) 43,  Energy (XLE) 63, Gold Miners (GDX) 28, Steel  (SLX) 53, Basic Mat (XLB) 49, AgriBusiness (MOO) 53, Tech (XLK) 66, Semiconductors (SMH) 66, Software (SWH) 66 Networking (PXQ) 38, Internet (FDN) 42



Bonds (Relative Strength)
 (1 up, 1 down, 7 neutral) Score 0

MUB (Natl Muni) 49 NCA(Ca Muni) 50 
BND (Total Bond Index) 51 BWX (International Treas Bonds) 60, PCY (Emerg Mkt Debt) 36 TLT (20+ US Treasuries) 49, IEF ( 10 yr Treasuries) 50, PFF (US preferred) 57, HYG (High Yield) 64


US Gasoline
Starting to break like the rest.


Mikey
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