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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

Tuesday, December 4, 2012

A sell off now would be too easy


    The 200 day average has contained the DJI for the last 8 trading days.  It is obvious resistance and most of the time obvious resistance needs to be broken  before any move can take place.  Think of it this way, the Bears are shorting the move up to the 200 day and every time it pulls back it makes that line more important. If that line falls and prices trade above it the Bears must cover and the Bull have the evidence for higher prices.  That is a signal for higher prices but then a reversal below the 200 day would be a signal for lower prices. The 200 day then becomes the line of truth.  Above it and the Bulls have it , below it and the Bears have it. I think we are going to see a move up above the 200 day before any action will take place.

    The dollar is selling off again and the DJI is going with it.  I doubt this will keep up for very long.  Gold dropped below 1700 late and the Daily on Silver turned down today. In the past the Fed has stepped in when Gold fell to this level and assets started to sag as they are now doing. A follow through tomorrow would put me short Gold and Silver.

    Mikey
    DJI Trend Summary 
    Daily Downtrend 13344 on 10-23 
    Intermediate Downtrend  at 12932 on 11-7 17 days old
    Long Term Uptrend 11315 on 11-1-10 2 years old
    Last high 9-14 13653  Last Low  11-15 12471
    20 day average rallies since downtrend began  1
    50 day averge rallies since uptrend  began 0
    IBD Market in confirmed uptrend 11-23-12  13009
     Long Term UP/ Intermediate Term down/ Daily Trend Down/Short Term up
    DJI Close 12951.78 -13.82
    Step up range: 13043 - 13344
    Current trading range 12471- 12973
    Step down support range 12000-12471

    Average watch
    50 Hour Ave: 12951 Price below
    20 Day Ave: 12865 Price above
    50 Day Ave: 13173 Price below (no long positions if this line is red)
    20 Week Ave: 13184 Price below
    50 Week Ave: 12945 Price above
    200 Week Ave 11049 Price above

    Overbought/Oversold Oscillator(Mikey reading) +150  to -150
    Take profits  at +150 readings  buy or cover at -150 readings
    3 day -16 N  7 day +37 N 20 day +23 N  50 day +24
    MACD Readings
    MACD Crosses: Negative cross = consolidation/correction Positive cross=uptrend
    Short term (50 hour) down (6 Hrs) signal 12-4
    MACD Hourly -1.14
    Daily trend (50 day) Down 29 days 10-23-12
    MACD Daily -49.24 Positive Cross 11-23
    Intermediate trend (50 week) Down (19 days).signal 11-7 12932
    MACD Weekly (+29.05) Negative cross  10-23-12
    Long term trend (200 week) Up 25 months)...signal 12/1/10 11577
    MACD Monthly (+520.51) Negative Cross 11/8/12.

    Volume Readings
    Volume (Millions) NYSE 3187  NASDAQ 1758
    Advance/Decline NYSE  -89 NASDAQ -129
    Mikey NYSE A/D line +66925 Mikey NASDAQ A/D line -15534
    Trader Psychology
    Put/Call day .88 10 day .84 Put Prem/Call Prem  .92 10 day 1.03
    New Highs NYSE 70  NASDAQ 34  New Lows  NYSE 21 NASDAQ 40
     
     
    Closing Prices

    US Stocks
    DJIA 12951.78 -13.82 S/P 500 1407.05 -2.41 NASDAQ 2996.69 -5.51
    DJT 5074.30 +12.92 DJU 448.30 -2.74
    US Debt Markets
    US Gov rates: 6 mo .145% 2 yr .258% 5 yr .629% 10 yr 1.62% 30 yr  2.80
    IEF (US 7-10 yr) 108.81 +.19 TLT (20 yr) 125.04 +.74 High Yield 92.90 -.13
    MUB(NatMuni) 13.32 -.35 Cal Muni(NCA)10.36 -.03
    BND Total Bnd Ind 84.91 +.07
    Commodities 
    CRB Commodities Index 297.23 -3.03
    Gold  1696.80 -24.30 Silver 32.81 -.87
    Copper 3.66 +.03  Platinum 1582,90 -22.90
    Oil 88.50 -.59  RBOB 2.68 -.04 Nat Gas 3.53 -.06
    US Dollar Index and World Currencies
    Euro 1.2997 +.0039 Pound 1.5926 +.0011 Swiss Franc 1.0622 -.0008
    Yen .11983 +.0056 Aussie 1.0472 +.0052 Canadian Dollar  1.0011 +.0016
    Dollar Index 79.63 -.24
     
    All Market Trends:
    (long positions only when Intermediate term and Daily Trend is green)
    Commodities
    Gold:      LongTerm/ Intermediate Term  Daily Trend// Short term
    Silver:    Long Term / Intermediate Term/ Daily Trend / Short term
    Copper  :Long Term/ Intermediate Term/ Daily Trend / Short term
    Oil:         Long Term/ Intermediate Term/ Daily Trend / Short term
    Gasoline Long Term/ Intermediate Term/ Daily Trend/  Short term
    Nat Gas :Long Term/ Intermediate Term/ Daily Trend / Short term
    CRB        Long Term/ Intermediate Term/ Daily Trend / Short term
    Bond Markets
    US Bonds LT Long Term/ Intermediate Term/ Daily Trend/  Short term
    Intl  Treas       Long Term/ Intermediate Term/ Daily Trend /Short term
    Intl Corp          Long Term/ Intermediate Term/ Daily Trend/ / Short term
    US Muni        Long Term/ Intermediate Term/ Daily Trend   Short Trend
    High Yield     Long Term/ Intermediate Term/ Daily Trend/ / Short term
    Currencies
    Aussie DollarLong Term/ Intermediate Term/ Daily Trend/ / Short term
    Brit PD         Long Term/ Intermediate Term/ Daily Trend / Short term
    Euro             Long Term/Intermediate Term/Daily Trend Short term
    Yen               Long Term/ Intermediate Term/Daily Trend/  Short term
    Swiss            Long Term/ Intermediate Term/ Daily Trend / Short term
    Can Dollar   Long term/ Intermediate Term Daily Trend/ Short term
    US Dollar   Long Term/ Intermediate Term/ Daily Trend / Short term
    Stocks
    US      Long Term/     Intermediate Term/ Daily Trend/  Short term
    Europe Long Term/ Intermediate Term/ Daily Trend/ Short term
    China     Long Term/ Intermediate Term Daily Trend/ / Short term
    Brazil  Long Term/ Intermediate Term/ Daily Trend/ Short term
    India   Long Term/ Intermediate Term/ Daily Trend/ Short term
    Emerg Mkts   Long Term/ Intermediate Term/ Daily Trend/Short term
    Japan Long Term/ Intermediate Term/ Daily Trend/ Short term
     
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