Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Thank God Its Friday! Why? With the sloppy choppy and YES SOME TOPPY in individual names we are seeing we can’t wait to get to the end of the day.

I will say this, when you look at the indexes you see one thing, however when you look under the surface we are starting to get a picture of something else, namely a lot of leaders breaking down. We have a saying around here, when the leaders start breaking down the rest of the market isnt far behind.

Look at the china leaders- SINA,SOHU,BIDU,YOKU. All are getting destroyed. Then there is PANL,OPEN ,SLV, PAY,CXO,CLR and you also see destroyed chart action. Then there is Energy, this sector too has been having a really hard time as of late. So you see a lot of key themes and names have all been rolling over in here.

I must say I see a lot more sloppy , choppy and toppy names than I see that look good on the longside. Im sure this weekend I will have a ton of names for you that ALL show topping patterns developing. Remember this is how the markets talk to us- In chart pattern recognition form. Pay Attention ! Suffice it to say in all the broken names ALL RALLIES ARE SHORTABLE but wait for the rally because we dont chase buses here on the short side AFTER they have already fallen apart, think SINA currently.

We will definately talk more about all of this over the weekend.

Below are your 60 minute index charts

Yesterday we said and will probably be the theme for the next few weeks around here:

On one hand we are still following the ABC Pullback Off Highs (POH) script with one more move higher potentially coming. Why? because we are still in a clearly defined uptrend and simply pulling back off highs in the indexes to trend channel support.

On the other hand we are also seeing leadership and individual names biting the dust and topping right here. Most of those are shown below in the short side coming attractions section and have already staged the first shot across the bow in first thrust down form.

So even if we are still following the script and we make one more move higher all these names will do is complete snapback rallies AND potential Right Shoulders of Head And Shoulders tops. Its those names that we’ll want to consider shorting when the time comes, in the meantime with those names its all about watching the patterns delevlop so as to be prepared in advance. The phrase that comes to mind is: "Its A Market Of Stocks"

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INDEX ACTION AND GAME PLAN FOR THE WEEK Of 5-9 through 5-13

For the last 2 weeks we said and still stands today:

"As you can see in both index charts we have a lot of structure. First off we have the current wave count of 4 waves with us in wave 4. If we are going to complete 5 waves up then we still have work to do with a pullback to boot (5-12 Which we are still in). What’s interesting is that any pullback ought to be contained to the green trend channel support and the neck line support of the head and shoulders bottom. So you see we have a floor baring any unforeseen events.

Remember this potential pullback is healthy and allows stocks to digest the recent thrust up. If we are going to continue to follow the 5 waves up script then we have one more swing higher after a buy the dips pullback. We want to be prepared for that as it’s going to set up a lot of names all in the realm of Pullbacks Off Highs (POH) with a lot of names already doing so that could go at any time."

5-12 Should we get a retest of the highs we will also be watching the action in the leadership that has bit the dust for shorting purposes so you see we got both sides covered for the most part all the while not getting too cute on either side.

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Short Side Coming Attractions — The First Thrust Down

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Recently we talked about us highlighting first thrusts down, snapback rally and then a bombs away to the downside. We will try to keep showing that pattern as we see them so as to get you mentally prepared for it from a visual standpoint.

5-13 Now we’ll start to focus upon another topping pattern or shall we say a change in trend pattern commonly reffered to as a double top. We bring this up because we see a ton of then building and actually a lot that have broken them to the downside. Suffice it to say we’ll try to spend more time on them this weekend.

But first look at XEC below.

One could even say CVX had that look before it tanked, as well as CLF too.

CVX

See the double top, then a break of the green uptrernd channel? Now take a look at the two charts below.

ARMH

NEW NAME

OTEX

NEW NAME

IBM

NEW NAME

MAKO

NEW NAME

SRCL

NEW NAME

In the process of carving out a double top?

PANL

NEW NAME

5-12 Should this issue rally back up to the 50 day I know what I’ll be thinking about doing as the 50 day is now resistance.

WWW

OPEN

5-12 Lets see what happens at the 50 day/100 level , assuming we get there that is.

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LONG SIDE WATCH LIST 5-8 AND WE STRESS WATCH

If I were to put money to work here. Where do I put it?

NOTE: It’s earnings season, make sure you know when that is to occur with whatever issue you are stalking.

Only The Best And Forget The Rest

AAPL

5-12 As you can see its still in the channel, for the day trading face of fear trader, the open in the 342 range was your trade. Now we see this issue having rallied right back up to resistance within the channel as shown below.

IBM

Gets moved to the short sell watch list above. Why? Its got a double top just like we talked about yesterday. Come to think of it, CMG and NFLX may also be in the process of doing the same thing.

CAT

5-13 If the markets keep pulling back and this name tags that prior low in the 103 range I might be tempted to go long for a quick trade. But the market makes that call not us.

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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.

Long side

ALLT

5-13 This name gets deleted to make room for all the short sells that are setting up.

5-2 The blue line is definite resistance, it’s going to take this issue to catch its breath and give it another attempt if it’s going to go.

GLD

RVBD

NFLX

5-12 Both RVBD and NFLX just go to show you its a market of stocks, even with the markets pulling back these two issues opted to trade to the beat of they’re own drum.

SINA

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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 JUNE Expiration from here on out folks

5-13 NONE- This weekend we will have some to highlight. I have a sneaky suspicion they will all be PUT OPTIONS!

Current Holdings

DANG (We are now long 3 May 21 call options to open at 3.10)

As we post they are currently at 1.10

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CURRENT POSITIONS

"Let Your Stocks Tell You What To Do By The Action They Exhibit"

LONG SIDE POSITIONS

IRBT (We are LONG 300 shares at 32.15 as of 5-5-11)

5-11 Any break of the May lows and we stop out of this issue none the worse for wear.

INFA (We are LONG 200 shares at 51.44 as of 5-5-11)

5-12 Gosh, another day like today and we’ll consider locking down some gains on this one.

5-11 Any break of the blue line and we stop out of this issue non the worse for wear.

DANG (We are LONG 300 shares at 23.51 as of 4-28-11)

5-11 Any break below the double bottom lows and we stop out of this issue.

5-13 For the most part all of our remaining positions are holding theyre own in here. IRBT and INFA both make me wonder if they are going to pull an IBM or SRCL in here.

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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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