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Whats different about today? We are actually up and HAVE STAYED UP FOR OVER 2 HOURS NOW. Still though bigger picture odds favor that over the next few weeks plus that we are not done to the downside. Right now we’ll take this bounce as that of relieving some oversold conditions.
Testing a support level and getting a reaction off of it.
The SPX on the other hand below broke thru a support level and is now back up above it.
As you can see both stohcastically speaking as well as support levels speaking wise we are in the level where bounces occur, BUT we need to get to the close first right?
It is also starting to look like a market of stocks as we have a few names on the short side and a name on the longside. Both of which we’ve made good money in in the recent past. On the longside watch list the new name is INFA on the short side its PLCM. Make sure you check them out in the respective watch lists
AAPL
As for AAPL? Whats up with AAPL? or shall we say whats not. Well the way we see it is that at the developers show they failed to impress by not launching another latest and greatest must have once in a generation life changing gadget that is going to change the way we do things. Sounds like a little bit of the street being spoiled if you ask us. We all know what happens when a terrible 2 yr old doesn’t get theyre way right? they throw a temper tantrum all in the form of selling the stock off. Waaaaa Waaaa Waaaaa. Still though, it stinks, we knew we were in the zone for a bounce in the market yet AAPL didnt go along with it? and instead rolled over more FAST? We say Bummer BUT we also say look where the support zone is currently.
Basically today and the last 2 days worth of action for that matter in this name has taken this issue to a support zone. Meaning the bulk of the damage is done for the short term. We’ll see. With our call option? We’ve got a little more than a week left and with the markets so short term oversold dont be suprised if those who are firmly convinced we are going down the tubes from here after we already went down the tubes could be in for a rude awakening come options expiration on the put side. Why? Remember time and time again we’ve seen around here that more ofthen than not when the majority think one thing (the herd) the market does the opposite. We’ll see come a week from friday.
Game plan for week of 6-6 thru 6-10
6-7 Our game plan mentioned over the weekend below still stands, now its just a matter of getting some strength.
Get to cash, preferably use strength to do so, start to lay out shorts as we see patterns we can work with not ones who have already fallen. Monday we want to get to cash so be looking for some locking in gains alerts especially if we get an up open. If the market is not up at the open? Then we let the opening dust settle, then start raising cash.
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Short Side Coming Attractions
PLCM
NEW NAME
TPX
This issue as you can see needs some time as in chart time to develop the pattern
We talk about buy the dips and sell the rips around here right? Well in this case we get a rip we’ll consider selling that rip as in short selling it. Wait for the bounce.
OTEX
IRBT
6-7 So much for downside follow thru. While Im on that subject check out a chart of CVX. It too never really followed thru either. But BIDU, SINA and MELI? Just goes to show you how powerful the FIRST THRUST DOWN chart pattern set up can be. MELI and BIDU have been moved to the featured but not trade triggered list.
SLV
Pay attention to this list as we have a fair amount setting up that we will be bringing to your attention as they show up along with more detailed education on topping patterns, change in trend patterns and short selling in general.
Those of you who are new here and have never shorted feel free to sit back, watch and aquire knowledge as one of our buzzwords around here is that of making money regardless of what the market throws at you. Short selling is just another tool YOU need to aquire for your tool chest.
As for the adage of when you sell a stock short your risk is unlimited? THATS GARBAGE. Why? simple- trade size risk management AND STOP LOSSES. It is unlimited but only if YOU allow it to be. Besides we’re in a correction.
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LONG SIDE WATCH LIST
"Only The Best And Forget The Rest "
"We Trade What We SEE, NOT What We Think, Hear Or Fear "
Remember the name of the game is Pullback Off Highs (POH) as it’s the only pattern you’ll ever need.
INFA
NEW NAME
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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.
SHORT SIDE
MELI
BIDU
6-7 It just goes to show you these patterns work. First thrust down, snapback rally and bombs away. The hard part about these two was that you had to short them when the indexes were already down quite a bit and short term oversold. Folks if these are our problems? In the form of missed opportunities? Well then thats a good problem to have vs the alternatives.
LONG SIDE
APKT
Any break of the red line and you need to walk away. Why? It’s a support level.
GLD
6-2 Approaching resistance in red
6-6 It ought to be interesting to see what happens at the red resistance line over the next day or so should it get tagged. Ahhhh Hmmmmm Notice the Negative RSI Divergence?
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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 — Nothing new at this point
6-4 Folks, we’ve got two weeks till expiration to see some sort of bounce in the indexes beit dead cat or otherwise.
Current Holdings
IBM (We are now long 2 JUNE 160 call options to open at 7.30)
As we post they are currently trading at 5.30
6-7 Sitting at support and stabilizing for the last 3 days. Thats a good thing.
ILMN (We are now long 2 JUNE 65 call options to open at 6.30)
As we post they are currently at 7.90
SFLY (We are now long 2 JUNE 50 call options to open at 5.40)
As we post they are currently are 6.00
CAT (We are now long 2 JUNE 95 call options to open at 11.10)
As we post they are currently at 6.20
AAPL (We are now long 1 JUNE 320 call option to open at 22.30)
As we post they are currently at 14.55
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Let Your Stocks Tell You What To Do By The Action They Exhibit"
LONG SIDE POSITIONS
ILMN (We are LONG 200 shares at 70.59 as of 5-25-11)
6-5 Sure likes that 50 day/ trendchannel line huh? we will say this, should this issue break then it’s a short sell. Why? Trendline break and a break of the 50 day average too.
SFLY (We are LONG 200 shares at 54.24 as of 5-25-11)
.6-7 starting to sport a Pink Line POH. this too is a good thing thus far
AAPL (We are LONG 50 shares at 338.15 as of 5-5-11)
Shown Above
CAT (We are LONG 150 shares at 105.15 as of 5-5-11)
6-7 Stabilizing here for the last 3 days. thus far thats a good thing. Sure beat the alternative
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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.
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