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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

Wednesday, December 19, 2012


    Options expire this week and the put/call ratio is very low, meaning that calls are over owned.  That puts downward pressure on the market this week.  The 20 day average fell below the 50 day on this last sell off. It has now turned up and is about to go up through the 50 day.  This is a configuration that I look for when I try to gage the beginning of the next leg down. Usually this is the end of the snap back rally.  Keep your eye on the 50 day average because a break below this average would flip the trend down.  The trend is up for now but I think the odds are that this rally is over.  The 50 day is now at 13102 and a close below this would put me short.  I am still short Gold with a stop at 1730.

    Mikey
    DJI Trend Summary 
    Daily Uptrend  13248 on 12-11 
    Intermediate Uptrend at 13034 on 11-7 7 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 sell offs  since uptrend began 
    50 day averageselloffs since uptrend began
    IBD Market in confirmed uptrend 11-23-12  13009
    Long Term UP/ Intermediate Term down/ Daily Trend Neutral/Short Term up
    DJI Close 13251.97 -98.99
    Step up range: 13344 - 13650
    Current trading range 13043 - 13344
    Step down support range 12471- 12973

    Average watch
    50 Hour Ave: 13247 Price above
    20 Day Ave: 13085 Price above
    50 Day Ave: 13102 Price above (no long positions if this line is red)
    20 Week Ave: 13205 Price above
    50 Week Ave: 12985 Price above
    200 Week Ave 11056 Price above

    Overbought/Oversold Oscillator(Mikey reading) +150  to -150
    Take profits  at +150 readings  buy or cover at -150 readings
    3 day +100 N  7 day +59  N 20 day +104 N  50 day +39 N
    MACD Readings
    MACD Crosses: Negative cross = consolidation/correction Positive cross=uptrend
    Short term (50 hour) Neutral (6 Hrs) signal 12-14
    MACD Hourly +29.20
    Daily trend (50 day) Up 8 days 12-11
    MACD Daily +67.50 Positive Cross 11-23
    Intermediate trend (50 week) up (11 days).signal 12-5 12932
    MACD Weekly (+55.93) Negative cross  10-23-12
    Long term trend (200 week) Up 25 months)...signal 12/1/10 11577
    MACD Monthly (+540.29) Negative Cross 11/8/12.

    Volume Readings
    Volume (Millions) NYSE 3732  NASDAQ 1891
    Advance/Decline NYSE -20 NASDAQ +32
    Mikey NYSE A/D line +69914  Mikey NASDAQ A/D line -13703
    Trader Psychology
    Put/Call day .65 10 day .69  Put Prem/Call Prem .83  10 day .97
    New Highs NYSE 181   NASDAQ 112  New Lows  NYSE 15 NASDAQ 24
      
    Closing Prices

    US Stocks
    DJIA 13251.97 -98.99 S/P 500 1435.81 -10.98 NASDAQ 3044.36 -10.17
    DJT 5320.78 +10.03  DJU 458.14 -3.20
    US Debt Markets
    US Gov rates: 6 mo .145% 2 yr .276% 5 yr .758% 10 yr 1.79% 30 yr  2.97%
    IEF (US 7-10 yr) 107.27 +.14 TLT (20 yr) 120.90 +.39 High Yield 93.57 -.10
    MUB(NatMuni) 110.44 +.65  Cal Muni(NCA)10.07 -.02
    BND Total Bnd Ind 84.38 +.18
    Commodities 
    CRB Commodities Index 295.62 -.97 
    Gold  1667.70 -3.50 Silver 31.12 -.55
    Copper 3.60 -.05 Platinum 1592.90 +1.10
    Oil 89.98 + 2.05  RBOB 2.74 +.05 Nat Gas 3.32 -.10
    US Dollar Index and World Currencies
    Euro 1.3130 +.0004   Pound 1.6074 +.0004 Swiss Franc 1.0784 +.0014
    Yen .11620 -.0031 Aussie 1.0507 -.0038 Canadian Dollar  1.0065 -.0023
    Dollar Index 79.31 -.02
     
    All Market Trends:
    (Initiate long positions when Intermediate term and Daily Trend is green AND the Short term turns green from yellow or red)
    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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