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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

Friday, March 29, 2013

Natural Gas ...First Qtr rally

Natural gas shot up 20 percent in the first quarter, its fourth straight quarterly gain,  A report by the U.S. Energy Information Administration on Thursday showed total domestic gas inventories fell last week by 95 billion cubic feet to 1.781 trillion cubic feet. We had a big oversupply in the market and now we've gotten rid of 20 percent of that oversupply. In fact, we've used 20 percent more natural gas this year than last We've gotten rid of that oversupply and that's what's driven the market.

The trend Intermediate and daily trends are now up.  That is the direction if the trade.  The traders will probably sell inn here now but that would be a mistake.  I would buy on dips to the 20 day and then the 50 day if it sells off.

Mikey
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