By David
Over the weekend we said:
"As you can see we have what looks to be waves ABC and us in D with that yet to finish off per the Pink line Pullback Off Highs line showing in the blue circle. Technically speaking it’s a nano bull pattern that could lead to another gap up at the open just like the last two days."
And there you have it.
"Of course you can see we also have numerous resistance levels in red just above. We bring this up as we would like nothing better than to see a pop at the open so that we can lay out some short sells into that strength."
One difference with today vs. the last two days though. Does everyone see it? No fade of the gap thus far. That doesn’t mean we are out of the woods mind you. It’s just an observation.
A break of the green line gets the ball rolling on the short side here.
So here you have it, right up into overhead supply all in the form of a gap up open. You can also see a few other things here short term. One is the pink Pullback Off Highs line we talked about over the weekend, that is the B wave of an ABC up with us being in C- take note. The other thing is the Orange circle, see it? It’s a gap. The big question we have over the next day is that of whether or not we fill it. Who knows, we just bring it up to make you aware of it.
One could say we are in the zone here. What you’ll also notice is that we are chugging around here unable at this moment in time to bust higher, but what do you expect we just ran 200 points on the Dow. If you are a bear this is resistance, if you are a bull we are consolidating at the highs today. We break higher in next 24-hours it’s here comes the orange gap fill. We roll over in next 24 hours? Well we could be on our way right back down. We’ll take it one step at a time here and one day at a time.
Moving on to the 60-minute frequency charts:
On to the dailies:
As you can see on the daily chart the S&P 500 is tagging the 50-day average here. Now you know why the one-minute chart is showing us unable to go higher after today’s gap and go.
We have a fair amount of names to be able to take advantage of a roll back over in the markets so it’s just a matter of the markets wanting to play ball here.
We even have two longs that are geared towards taking advantage of a roll back over in the markets here too so we have the gun loaded, it’s just a matter of that elephant to walk by.
With our current holdings? We have NXPI closest for us to lock in gains with walking away from DECK and AAPL right behind. Make sure you read the notes under each of our current holdings. Again one step at a time.
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SHORT SELL WATCH LIST
For weeks we’ve been highlighting numerous times the First Thrust Down pattern. Below are a few examples.
SHORT SELL WATCH LIST
NOT FOR THE FAINT AT HEART! — NFLX, CMG and BIDU
These names are prone to big swings in each direction with big average daily ranges. That makes these names extremely volatile, consider yourself warned. In other words if you can’t handle the heat these names generate stay out of the kitchen. We can and are willing to sit with them underwater should they initially go that route after we short them, are you? How can we handle that? Two reasons, one is we are not perfectionists around here and trade size position risk management. Remember what we’ve said repeatedly about it? Never allow yourself to get into a position that can devastate your account should they go awry.
NFLX
NEW NAME
The blue box is first thrust down. It’s now in a wicked snap-back wide range bear channel rally. Right now? there is nothing to do but watch, that’s why it’s called the watch list. Same goes for BIDU and CMG below.
BIDU
NEW NAME
Blue box is first thrust down. It’s now in a wicked snap-back wide range bear channel rally.
CMG
NEW NAME
Blue box is first thrust down. It’s now in a wicked snap-back wide range bear channel rally.
BRY
NEW NAME
Not yet. But keep an eye on it as a monkey can flip a switch at any time. Same goes for the rest of the names on our short side watch list.
XLE
NEW NAME
CLF
NEW NAME
This one looks the best because it’s tagging the 50-day average. If it stalls here? Then we’ll want to get serious with it.
Right now we are playing it by ear. We got the gap open pop much like Friday with one difference — thus far we haven’t faded. That’s why you saw no trade triggers out of us this morning.
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LONG SIDE WATCH LIST
If I were to put money to work here. Where do I put it?
SLV
Gets moved to the featured but not trade triggered by us section.
VXX
NEW NAME
First Thrust Up (blue box) then Pullback Off Highs (POH) upon completion of the POH? (Pink) It’s time to buy.
SDS
BACK ON LIST
So if you buy right here what is your risk? A pullback to the blue support line. That is basically a little over a 1 point pop from here. Keep in mind in order for this to break support the SPX has to break into a new high. But even if the SPX were to break into a new high it doesn’t mean it’s going to stick. See all the gaps up the SPX is creating off the recent lows? Odds favor they get filled. This one is high on our list.
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Featured But Not Trade Triggered By Us
This is where names that we have on our watch list that have triggered but for whatever reason we did not take them (can’t do them all) in our trade trigger alerts. This section is because a lot of our subscribers opt to use our information as they see fit from a do-it-yourselfer standpoint.
RAX
CVLT
ALTR
KLAC
NOG
SLV
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All About Options In The World According To All About Trends
NOTE: The exchanges recently started WEEKLY EXPIRATIONS of options. Going forward, make sure that you check to see which ones you are buying. Let’s stay with traditional options expirations which are the ones that expire the 3rd Saturday of every month.
Options Watch List
ALL PUT OPTIONS All APRIL expiration
CLF
The ones we want to look at are the APRIL 100 puts. With the stock at 91.00 these are priced at 10.00 which means you are paying 1.00 points for time.
BRY
There are two classes one can look at with this issue.
They are the APRIL 50 puts. With the stock at 47.42 these are priced at 3.40 by 4.00 which means you are paying 1.40 points for time.
The other ones are the APRIL 55 puts. with the stock at 47.42 these are priced 7.70 by 8.20 which means you are paying 60 cents for time.
XLE
The ones we want to look at are the APRIL 84 puts. With the stock at 77.50 these are priced at 7.00 which means you are paying 50 cents for time.
Current Holdings
DECK We are now long 1 April 70.00 Call at 14.80 as we post they are currently trading at 11.50
We talked about cutting and running on this issue over the weekend on a gap up in the market if the market fades the gap. Know what? We didnt fade the gap up in the market just yet. Thats why we still hold it but it is on a short leash we’ll tell you that. In the meantime? anything that this issue is up today just adds to our month to date over total value of the virtual portfolio gains.
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CURRENT POSITIONS
"Let Your Stocks Tell You What To Do By The Action They Exhibit"
LONG SIDE POSITIONS
DECK (We are now LONG 200 shares at 83.55)
We talked about cutting and running on this issue over the weekend on a gap up in the market if the market fades the gap. Know what? We didn’t fade the gap up in the market just yet. That’s why we still hold it but it is on a short leash we’ll tell you that. In the meantime? Anything that this issue is up today just adds to our month to date over total value of the virtual portfolio gains.
NXPI (We are now LONG 325 shares at 26.56)
We are extremely close to walking away here on this one. What we don’t know is if it’s going to go higher here. So instead of talking about what we don’t know with it let’s talk about what we do know, and that is we have decent short term gains to add to our month. As we post this issue is 28.30 and that gives us a gain of 1.74 on 325 shares which is a $565.00 dollar gain. All for a few days worth of work all from using the 50-day as a guide — not to mention buying in the face of fear.
AAPL (We are now LONG 50 shares at 341.25)
As usual, market up = AAPL up, market down = AAPL down. See that 50 day? It’s resistance. So what happens if this issue goes up to that level and the market is starting to roll over about the same time? You got it, AAPL rolls with the market. What it also means is that at that level we’ll have a small 4-point gain. BUT if the market rolls over? guess what happens to that gain? You got it — poof and we’d be right back under water vs. being in cash and be able to look at it in the 329 level again.
Of course it has keep going higher from here. Look we love AAPL, we all love AAPL even the Beatles love AAPL. That’s not the issue here. The issue here is that it’s all about the stock.
SHORT SIDE POSITIONS
None but we are getting close with CLF being at the top of the list.
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To our NEW SUBSCRIBERS
What we’ve tried to do is break our watch list down into chart pattern recognition structure from a visual standpoint. Learn the patterns and the components of patterns and you’ll blow those Wall Street MBAs away. You don’t need a $3,000 software program either. All you need is a BURNING DESIRE to be the best that you can be and we’re here to help.
We have a lot of new folks here and we thank you! We want you to take it easy, get to know how the routine works around here for awhile and to feel comfortable.
We hope you all aren’t here because you are chasing performance. For us it’s more about educating and making you the best you that you can be first (that’s what we focus upon!). Like many of our long time subscribers they have all found out that they have no use for traditional Wall Street (and we don’t blame them) and it’s our hope that over time you’ll have acquired enough knowledge from us to say the same with conviction.
One of the most important things we want to stress is that of RISK MANAGEMENT via POSITION SIZING. You don’t need to stack your account with just a few big positions as we’ve seen it time and time again that those who get into trouble are the ones who take large positions and do not employ any risk management system IE shoot for the fences. Those are the people who live on the fringes of extremes and yes ultimately get burned.
As a guideline a good initial system is that of the following example.
Let’s say you have a $100,000 virtual portfolio and let’s say that as a guide you never place more than 10% ($10,000) into any one position. Now let’s say that one day a news driven event hits (over which you have no control over anyway) and one of the positions tanks 20%. On its own that position is sporting a $2,000 loss, while that may seem devastating on its own its really no big deal overall.
Why? Simple its all about risk management being properly employed. What is the impact of a $2,000 loss to the TOTAL VALUE of the virtual portfolio in this example.
Answer: A whopping 2% LOSS. Now you know why we say no big deal.
We can also tell you new people here that you will get stopped out of names and you will take hits. There is nobody on the planet living that has ever hit 18 holes in one and there never will be. We’d rather get you grounded in reality right away vs talking about pie in the sky all the time like a lot of other sites. In so doing your head is screwed on straight from the start and when those days happen (and they will) mentally it won’t mean a thing to you. To us that’s what’s most important is YOUR state of mind as it’s your most important asset. We hope you appreciate our honesty.
We have a very good retention rate here at All About Trends and a lot of great outstanding people here. We like to think that a part of that is being upfront about what can happen (in both directions). Verses those up 500%, I turned $50,000 into $3 million or some other absurd number to get you to bite. That’s not who we are.
WELCOME ABOARD!
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Lastly with regards to taking any trade:
Remember the moment you take a trade you are at the mercy of the market and have no control except when to sell. If you are not willing to take the risk and are not willing to pay that price do not take the trade. We are willing to take that risk knowing full well the end result could be a loss. That said make sure that virtual portfolio management trade size is used accordingly. With any position you may take make sure that should something go awry the amount of total impact to your account does not devastate your acct. Try to stick to a 5% position That’s the key to virtual portfolio management, not biting off more than you can chew.
Remember the mechanics of reality with regards to the stock market states a stock can only do one of three things: Up, Down, Nowhere. The moment you hit the enter button you are at the mercy of the market therefore the only control you have is when to sell/cover. You can’t manage your gains as you have none to manage initially. Knowing this in advance it allows you to stay in outcome, that being you will either:
1. Make a gain
2. Wash
3. Get stopped out at a loss
Remember the market IS the boss. IT is going to do what IT wants to do.
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SUBSCRIBER ONLY WEB SITE
Don’t forget you can view updates in the middle and the end of each trading day complete with current charts, along with our current performance at our subscriber only web site.
