Wrapping Wednesday

Continued day trading as I said I would and was very successful. Hard not to be on a day like this.

Took KKD early at the midpoint high (see Pivot Points) and held it through R3. In numbers that is 12.54 - 13.47. Did a similar with TRID except was out at R1 - a slower developing trade with a slower moving line. Still a 28 cent profit is OK. I'm feeling a lot better now that I'm not losing money on stocks such as Glass (up 2 and change today) and CTXS up a buck 77 on the day. Of course they might give it back and then some tomorrow. I just didn't want to hold either one of these into earnings. I'm still not sure how GLW managed to "beat by a penny."

Still holding CRVL and it went serious-profitable for me today but I decided I didn't have a good reason to sell it. I'm pretty sure that it's going to continue to go up - at least past 46 bucks. Maybe I'll sell then. Sprint also went up some more and I still can't find a good reason to sell that one. Not as sweet as CRVL but I have a lot more exposure too. And Q's are really turning profitable. The weekly indicator is green. I hope it can hold through Friday - I don't think I'll keep the Q's over the weekend. Meanwhile I intend to continue day trading using the Pivot Points as my entry and exits. It's kind of neat not having to make any real decisions except hit the line and buy - hit the other line and sell.

Was today the long awaited GOOG short squeeze? Nah - just normal activity for an abnormal stock. How can you tell? The volume forms a bowl - high for the first hour and a half - tapers into noon - begins to climb again through 4 P.M. Still a nice 4% bump and I'm sure everyone who bought at 513 in front of Jimmy's short squeeze breathed a sigh of relief.

But you have to figure that any day that SUNW shows a profit is a day when everyone should show a profit. They have the best warranty in the business - you pay for it but don't dare go without it 'cause you're going to need it. (You don't read that in their brochures).

For tomorrow first I'll give the data points and they all point to a down day. The up/down ratio went up a paltry 2 percent to 60 but the new 20-day high/low ratio hit 84% and that is hugre. The last time it was this high we had a sustained three day loss. The VIX is back in the overbought zone between 5 and 10 and all 4 major indices plus GS printed strong white candles in the final hour. That in itself should bring the market down a bit tomorrow. But - in the after hours EBAY reported massive earnings and even as we speak there is a feeding frenzy going on in all of the internet stocks. If that carries through to tomorrow and it should we're going to have another up day. I'm forecasting an up day tomorrow.

The magic coin meanwhile sits and sulks having miscalled yet another one today. But for tomorrow the coin says ... tails - bear market - can't convince the coin that sentiment beats luck.

Marlyn is now 7 - 4 and 1 and the coin is 4 - 7 and 1 maybe skill beats luck after all. We'll see.

I'm giving Jimmy Crack Corn Pone a break today. But we'll be watching tomorrow - day 7 of the GOOG short squeeze vigil - get your candles at the door.

Wrapping Turdsday

Wow! Was I ever wrong! And am I ever happy! What? Oh yeah, man! (Emeril doesn't have that phrase copywrit - at least not yet). (By the way his Garlic Lovers Spaghetti sauce is out of this world wowee!). 'nuff about that - back to the market.

As noted in an earlier post today AAPL led the market lower because of their silly 4 penny miss. Now I was thinking - what if we all got together - all the AAPL shareholders (I am not) and gave them 4 cents out of our own pockets - do you think that would help? It's a thought.

In a later post I asked the musical question - whither the Q's next week and if you all answered up, up, and away - you might be right. In the past 6 months there has only been one down week followed by a down week - the rest have been up weeks and today was a super blow-off if I've ever seen one. A lot of crap stocks were sold today along with AAPL.

Day three of the GOOG short squeeze vigil passed without incident and I'm beginning to receive dispatches from the front - most of them saying things like - what the hell and are you kidding and who is the Jimmy Crack Corn Pone anyway? To which I can only reply - Jimmy said it - I reported it - some people believed it - and I don't care. Or in the words of my dear old Ma - Do Dah Do Dah Day.

I dumped Chiquita Banana today based on the fact that it didn't seem to want to go anywhere but held RX because I'm stupid. Also held GLW and SYMC and CRVL and added to the pain with S (Sprint). Why Sprint? Simple I read my Notable Calls this morning and Sprint is troughing (much like MOT I might add) and they are probably going to go up once all of this shake-out is over.

I might take a position in MOT tomorrow. And I heard about this little guy the other day, GTXI, that has something or other coming out of trials and the news is looking good. I might add a small bite of that to the plate as well.

Tomorrow is options expiry day and contrary to popular belief it is usually a pretty calm day. I expect a moderate to mild rally tomorrow.

And that is based on the up/down ratio printing 30% and the new 20 day high/low ratio printing 38% (they both went the same way for a change) and the fact that the VIX has climbed back up within the 5% range and the fact that every major index printed red in the final hour and GS, the proxy for the stock market of the 22nd century, printed a doji. I would like to see it go down again but trust me - everybody is in a hole and there is only one way out - up.

The magic coin says ... tails - bear market - we'll see coin, we'll see.

Marlyn is now 3 - 4 and 1 and the coin is 3 - 4 and 1. At least we disagree about tomorrow.

Wednesday Wrap

Strange day - a little up - a little down and once again no clear direction in a directionless swamp. AAPL just came out with record earnings and that probably means the market will explode tomorrow and I can't wait. I bought a bunch of crap today and wound up holding it overnight. Among the many mistakes - RX, CQB (Chiquita Banana), CRVL, and SYMC. Still holding GLW but regretting every minute of it. Especially since it went past my buy point and I could have gotten out with a small profit this afternoon. I'm going to regret that too.

Wait did anyone hear that? That rocket blast? That was DHI - freed from the encumbrances of my owning shares it took off today with the rest of the homies. Up 2.35% on a relatively down day in the old marketplace. And Bullish Jim thinks that he sells too soon. Fahgedaboudid!

Day two of the GOOG short squeeze watch dawned bright and crisp and as the nation waited for that event with baited breath - it didn't happen. Why oh why Jimmy - tell me why...I mortgaged the homestead - I sold off the hogs including Ma's prize winning Jersey Petunia and put it all on the line at 513 - and now its selling at 497 and the broker called and he wants the cows, horses, and chickens toooooo.

Nobody knows nothing - don't ever forget it and if you wake up every morning and look in the mirror and say that and add "including me" to the end of it you will probably stay out of trouble. I didn't this morning - obviously.

MDRX that I bought yesterday for a couple of days hit a very tight stop loss this morning (my error - I told you the range was a buck and change but did I listen - oh hell no) and, of course, rebound one tick too late. Anyway I replaced it with RX and that one just kind of meandered sideways/down (swon which is the opposite of swup) all day. CQB is a buy because of the recent freeze out in CA and it was going up and then hit an imaginary ceiling and did a mime impression all morning beating against it and then fell away. Both these two are up or out tomorrow.

SYMC I grabbed up at the bottom and I actually made a buck or two on it today. If it turns tomorrow it too is gone - I should have sold at close today but I was busy with some other things - if it continues up tomorrow I'll double up. I know I'm going ot regret that. CRVL is also a purchase against a brighter day (tomorrow).

Tomorrow should be better - AAPL's earnings will make the pain go away and everything will go up and the world will be a better place. Right.

The up/down ratio actually increased today to 44% but the new 20 day high/low ratio went down to 60%. That's what I like about two disparate ratings that sound alike but are totally different. The only time they mean anything is when they both go in the same direction. Otherwise it is a split decision. The 4 majors and GS were all over the place at the end - some up - some down. More split decision - and to add to the confusion the VIX actually went down in a down market - talk about not knowing which way the wind is blowing. There's a reason for that but you'll have to go ask Adam as I haven't a clue. I think all of these holidays and extra days off and the rest of that has gotten the markets so confused they don't know which end is up. But I'm still thinking about years past and the fact that right around here you normally get a bump. Of course earnings have been pretty good in years past.

I think tomorrow will be another weak day but will close up - I'm calling tomorrow for the bulls.

The magic coin says ... heads - bull market coming.

OK it was a bear market today and I called for an up market that makes me 3 - 3 and 1 and the coin is 3 - 3 and 1. What a race - a train wreck in slow motion.

Friday's Wrap

As noted earlier - after a month of holding for a better day I sold SYMC for an 18 cent loss - could have sold it yesterday for a half buck profit but nooooo had to hold it. Who would have suspected that good news such as an open portal to sell your goods to a couple of billion Chinese would be seen as such a bad thing on Wall Street. There is absolutely no rationality in this market.

I completed the first round buy on Glass (GLW) and also added to my DHI holdings. Not quite back to where I was but I will probably get there next week if they keep edging up.

Going to keep this simple today - the up/down ratio dropped back a bit to 56% but the new 20 day high/low ratio went ahead to 79%. That plus the fact that the VIX is 12% less than its 10 day moving average suggests a down day coming on Tuesday. Add to all of that the fact that the Q's, DIA, SPY, IWM and GS all put in strong white candles in the final hour and we have to say Tuesday is definitely a down day.

The magic coin says tails - also a down day.

Today makes Marlyn 3 and 2 and coin 2 and 3. We are not doing very well this year so far.

Later this weekend I'll show you the difference between a scalper special and solid investment and how to tell when to hold 'em and when to fold 'em. That's if Blogger ever allows charts to be uploaded.

Turtles – Again

The Turtles original method was based on Donchian channels. As I remember it they went long when the price went above the upper channel and short when it went below. Then they used risk management to keep them in the game. In other words if the stock kept running in their desired direction they stayed with it and if it came back the stop loss would take them out. They had many small losses and a few large wins and that’s what kept them solvent.

I wrote a filter using Donchian channels and set it up like the Turtles would have done – then I back tested it - I hate “many small losses.” I take enough as it is.

So I changed it – I set the filter to look for stocks that came back up through the lower Donchian channel after being below it for at least one close. This is what that looks like –



This output is actually for Wednesday's close - you can see that Glass responded well to the Donchian channel.

When I back tested it there were some absolutely great results. 62% win percentage and 75% annualized ROI. But the net change over time was where the real story was told – This has the potential to be a real intermediate (10 – 20 day) term filter.

NET Change
1 day - .04%
4 days – 1.07
10 days – 2.39
20 days – 4.33
30 days – 4.86

Donchian channels Marlyn’s way – it might be a winner.

Wrapping Thursday

Fortunately I wasn't around much of today having had a little personal business to get out of the way. It seemed that for all the action in the indices the only thing that moved was - I really don't have to tell you this do I? - Homebuilders! DHI made back 54 cents and I made back most of my losses. Meanwhile SYMC managed to round trip a 40 cent profit and turned in a 13 cent loss - on a day when the COMPQ was up 25 points. One more day and I'll be done with that piece of crap. Not that I don't have a profit - I do - but I think the money will be better used somewhere else.

For example - I bought some Glass (GLW) on the open based on the dummy spot on the weekly charts from two weeks ago followed by a doji last week. All of that looks like a bottom. It went up today and given its recent past this generally this means a smack down tomorrow but GLW will be my new swing trade. Today it is printing a crossing formation on the daily charts. If GLW confirms tomorrow I'll finish the buy for this round. I never got past round one on SYMC because it never went anywhere. Should rename that stock the old yo-yo. To put things in perspective I made more today in a half position of Glass than I've made in a month in SYMC.

Since I was out I didn't do any mo-mo day trading today. Just as well none of the usual suspects did much of anything. CRVL limped around for a bit and round tripped 60 cents which is nothing for that stock - it usually round trips a a buck and a half every hour or so.

GS looks like it was shot out of a cannon and then just sat in space all day. Most of the activity in the market seemed to be over by 11 A.M. My darling from yesterday CTXS gained a half a rock today. Had I been around I probably would have played it again off a "gap up - pull back" play.

Going to be out early tomorrow so I don't think I'll make any plays at all unless I fill GLW.

Which is all well and good because I think the market will take a rest tomorrow - the up/down ratio is 60% which is not too terribly bad but the new 20 day high/low ratio is 70%. That, coupled with the VIX being more than 5% below its 10 day moving average, suggests a down day coming. We have a split ending in our four majors with two red candles and two white candles in the final hour and GS, that old tie-breaker, landed on its edge - a doji (still tired).

My prediction - down tomorrow and the magic coin says ... tails - it agrees. So once again we will both be right or both be wrong.

So far - Marlyn 3 and 1 and the coin is 2 and 2.

Wrapping Tuesday

Except for the fact that I'm actually carrying a small portfolio for swing trade purposes I welcome a down day. Now despite the blah blah blah from the bobbleheads on bubblevision (I don't watch I just read the headlines) it really wasn't because of the Fed or because of Best Buy or even because Oil went up or down or the dollar went somewhere or the trade deficit which last month caused the market to collapse because it went up this month caused the market to collapse because it went down. Whew - did I get it all in? I hope so. The reason why the market has been a little weak lately is because - are you ready Chuckles? - because there isn't anything to buy and most of the buyers are on the normal - ain't gonna do nothin' between now and Christmas/Chanukha/ Festival of F'in Lights or what have you because I'm on my out of pocket vacation. I.E. I'm screwing off because that's what we do between now and January 1st. Besides its options expiration week. What do you expect?

I had to get out of CTXS today because I couldn't stand the pain any longer and that one was hurting me. I probably sold too soon and if it starts going back up anytime soon I might reacquire - although for the life of me I don't know why. Replaced it with some GLW although that is probably going to prove to be a mistake as well - we'll see. At least it didn't go down. I also doubled up on my ORCL position this afternoon at close of business. If we get a good bounce tomorrow morning I'll sell off that portion for a quick profit. If not I'll sell the original half tomorrow at COB which was my plan anyway. ALTR and SYMC didn't do much either way today which is fine.

The VIX remains more than 5% but less than 10% below its 10 day average but the good news is that the up/down ratio is at 35%. There were 483 new 20 day highs and 506 new 20 day lows. The first time in 11 days the new lows outpaced the new highs. The 4 indices we track DIA, IWM, QQQQ, and SPY (actually the ETFs of indices) all finished the last hour strong. Only GS, off a report of extremely strong profits, finished the day down. That's normal - there is no place for GS to go now but down they've made all the money there is to make in the entire world (sarcasm off).

Put all of this together and I think there will be a small rally tomorrow and Thursday then a flat Friday (expiry day)and a weak week next week.

Old magic coin blew it today and starts the downward slide again - 36 and 27 - I smell a TV contract coming soon - isn't that how bubblevision rewards ostentatious mediocrity? But for tomorrow ... landed on its edge - just kidding - tails - bear market. Dumb coin.

Thursday's Wrap

Bad storms today so I didn't get to play my usual round of golf - oh well. Made some money though - I played AMR and got a few cents out of it. Sold HANS on the bounce this morning and made some there - bought it back this evening and am going to do it again tomorrow morning. Seems that the only time it goes up is on the open. Sold off glass (GLW) too. I know I said I was going to keep it through the end of the month and I probably should have but I kept worrying about it and when you are worrying about a stock you should sell it. I worry about glass because of the flat screen glut on the market and eventually that is going to result in even more downside (I think) for that stock. If it pulls back again I might take another shot at it. Oh who am I kidding - the next dip and I'm in. As the man says - in a bull market you can only be wrong buying dips on the last one.

Tomorrow is probably going to be a very flat day because it is expiration day and lately the markets don't move on expiration day. But the externals are funny. The up down ratio took 1100 off and is printing 44% which is a huge down from yesterday. The new 20 day highs took 400 off and and the new 20 day lows added 50. The VIX stays overbought and now is more than 6% under its 10 day MA. The three sisters and the ugly step sister all finished the day printing a red candle in the last hour. But GS printed a strong white candle. If I only had a brain I would have put my entire account in GS a month ago and retired today. But I don't. Anyway yesterday I noted that all 5 of these issues finished with a red candle and this morning I went and looked and found out that that generally means a streak of higher highs coming as it doesn't happen that often. I think tomorrow is going up again as there doesn't seem to be anything that can bring it down, not news, not earnings, not anything.

Meanwhile the magic coin has now missed two in a row and that is not good. He's 30 and 18 and for tomorrow he says ... heads - back on the bully bandwagon.

Wrapping Wednesday

Market went up - what's new? Fed heads said no new interest rates. Ok - next? I actually lost $236 today. Took a late day position in HANS and it collapsed. But I turned it into an investment - you know the difference between and investment and a trade don't you? An investment is a trade that went South with no stop loss. I'll pitch it tomorrow on the morning bounce. I'm also hold a position in glass (GLW) which I plan to hold through the end of the month.

For tomorrow probably more of the same. As seen this morning we are starting into the Santa Claus rally period of the year. This is the time when all of the funds have to buy buy buy in order to make their numbers look swell and sweet to the hoi poloi so that more and more suckers - I mean - customers will come and buy their wares. Blah blah blah BS BS BS... anyway the three sisters, the ugly stepsister and the proxy for the 22nd century all finished the last hour in the red. I think that means we bounce tomorrow. The VIX continues to stay well below its 10 day average which is not good and the up/down ratio remains in neutral at 4154. Unfortunately 1249 stocks are now at new 20 day highs and only 150 (or half of yesterday's total) are at the low. The last time we had numbers like that the market went up the very next day and then went down for a couple of days. And the time before that and the time before that it did exactly the same thing. So I think the market is going to go up tomorrow and down on Friday - given Friday is expiration day it probably won't go anywhere.

Old magic coin is 30 and 17 having called a bear day for today. But for tomorrow he is saying ... tails again - more bear predicting.

Tuesday Wraps Up

What happened? I go out for a couple of hours and bang look out above - what is going on? Irrational exuberance that's what.

Well I had planned to sit by and watch but when they hand them to you from out of nowhere you have to make the play. The main play was CVNS off a drop that I played as if the first 15 minute candle was a dummy spot. Fact is the drop was from a news report that was totally meaningless. By the end of the day most of the 2 buck drop had been recovered. I was out of it long before that but for a nice profit anyway. I also played GLW and made a small profit, very small. I had CTXS overnight as I mentioned yesterday and for some reason or other - oh yeah because I thought the market was going to collapse today - I sold it off its spike in the first 5 minutes. That's ok, I made some pocket change after commissions.

People say you should post your losing trades - well - when I have them I post them - I'm just not making as many plays any more and I'm trying to adhere to a very successful process. (I'll publish that this weekend if I don't have anything else to say). Anyway as I was saying if I have a loss I'll let you know in the meantime these are my winners.

For tomorrow - I haven't a clue as usual. The up/down ratio sits at 51% which is neutral, the new 20 day highs went up 8 to 766 and the lows went up 9 to 301 - what all that means - your guess is as good as mine. The three sisters finished the last hour in the green. The ugly step sister (who was the first to turn around this morning) finished very strong and GS, the proxy for the 22nd century finished red.

I'm beginning to think that that signal doesn't signal anything. I have to start looking at it and trying to find a correlation somewhere. The VIX finally got into the game and stands now at 5% under its 10-day moving average. If that continues (which I doubt) we might have some trouble on the horizon.

The magic coin, Mr. Majestic, is 30 and 16 having nailed yet another day using just pure plain blind luck - I should be so lucky - for tomorrow ... tails - bear again - maybe, who knows.

Wednesday - Fed Wrap Up

Wrap the Fed up - a more irrelevant bunch of folks do not exist. Sometimes I wonder who reminds these guys to breathe. Anyway as you undoubtedly already know they stood pat - which is what was expected. I still expect them to start cutting in the new year and so does Bill Gross of Pimco the biggest bond fund in the entire world if not the universe. No matter - they turned the Dow on a dime and lo and behold we have a new record. Those of you who are following along closely realize that the new record is just about worth nothing.

I had a position in GLW again today - made about 30 cents net but at least I made a profit - I can go back to trading again tomorrow with my head up and my 30 cents jingling in my pocket and feel as if I might even know what I'm doing. I don't which is why I have rule 1 - nobody knows nothing - including me.

For tomorrow more of the same - the up/down ratio remains in neutral and the new 20 day highs are running away from the new 20 day lows, 1037 to 220, which is beginning to sound like a broken record and about as appealing to the ear - the VIX remains in neutral territory and the 3 sisters all finished strongly in the last hour in the green

Mr. Magic is 23 and 11 having missed today - for tomorrow he says - heads - bull market time.

Probably

GLW and Stop Sweeping

Now that I am a little cooler about the whole affair - I wanted to explain why the GLW specialist ripped me off yesterday. He had a large order for GLW just above 22.60 - probably an institution reloading after the selloff that's been going on in front of earnings - looking through his book he realized two things: 1 - he had a lot of stops down to about 22.20 and a lot of buy orders between 22.20 and 22.60 - so first he sweeps the stops to gain inventory - then he sells out the inventory to everyone down below to get the price back up and finally he fills his large order. In 3 minutes he turned over 3 million shares, in 15 minutes he literally round-tripped 9 million shares or over half of the 14 million shares traded yesterday. Can I prove this - no - why bother we all know what happened and it was my fault for putting a stop so far out of the money that it couldn't possibly be hit unless the stock were going down to stay. Ha - Ha - Ha.

Easy money for the book and one more reason to only use electronic trading as offered by NASDAQ.

The New York Stock Exchange is so 1900's - don't you think?

Tuesday Wrap Up

Oh boy I wish I had passed on today - but nooooo I had to play GLW (Corning Glass). I took a position and watched it drop a bit - I doubled up and watched it drop some more - I said no matter it is bottoming and will come back - well it did - but only after the specialist running the book ran my stop and about a thousand others - in the space of 3 minutes he round tripped 3 million shares taking out a whole bunch of stops including yours truly - end of the day - GLW finished in what would have been for me a profitable area. I wish I had passed but more importantly I am a fool for using a stop on a volatile stock - but GLW is not a volatile stock - today was its most volatile day in about two years. I'd say a bad word but it wouldn't help.

GLW has bottomed and tomorrow it will go to the sky - I'll be there - and this time no ill timed stop sweep will catch me out.

Tomorrow we can expect more of the same - except that earnings this evening are coming in strong and righteous and I think we might even go higher - the three sisters all finished the last hour in the green - the up/down ratio is neutral at 42% the new 20 day lows actually added to their anemic total and are up to 272 while the highs are backing down to 731. The VIX came back into neutral territory and the magic coin - 23 and 10 having picked today correctly - says for tomorrow - tails - the bear is about.

We'll see.