Thursday's Wrap

It was an up day but not by much. I expected a lot more and didn't get it although the stocks I'm in currently did well. Those are GGB and OI - AGIX was stopped out. Candidly as I said in the Dead Cat Bounce post - they are going up or they will probably stop out so set the stop close - I did and it did. I added to OI. My day trade BMR also stopped out but that was this morning.

Since I missed most of the day this will be brief this evening. I see that MSFT made a few cents today as did AAPL. I would have expected AAPL to have done better but it is still considered a "tech" stock and as such it follows the market up and down. GOOG on the other hand is an internet stock and it went down today by a few cents. That kind of describes the market thoroughly - totally random lurching around with no direction. It wants to go up and it wants to go down. Best thing to do is wait till it picks a solution to its problem and then go along with it.

The model portfolio went up to 6.91% from 6.02 and the benchmark went to 1.13%. We're going nowhere fast - I didn't make a portfolio for those stocks I isolated yesterday yet - maybe tomorrow.

The INDU ATR went back up again and that is not good - it printed 112.61 at the end of the day. We need it to continue down in order to have the market go up. Then after it gets into the 90's or so we want it to sit there and stay above 80. That would be perfect.

The VIX is now 7% over its 10-period moving average and the up/down ratio is 51% - a lot of neutral going around all of a sudden. The New MoMo is still looking good and has transitioned to under the line but not yet at -.005% which is the target for sustained upward movement -



I'm going to forecast tomorrow as another up day.

The coin says that tomorrow will be ... heads - the coin thinks it will be up as well.

The score now stands at Marlyn 24 - 20 and 8 and the coin is 24 - 20 and 8.

Happy New Year!!!

Wheee!!! I have never figured out what the thrill is - one year passes another starts and everyone gets a holiday. And the only reason for it is to get over a hangover because, for some reason, you are supposed to drink yourself blind on New Year's Eve. Pagan holidays - why not.

I spent the morning trolling for some swing trades and I've come up with two candidates that I will enter on Wednesday morning. They are - AES and BLG. Both of these companies are well-regarded by institutions and both show a premium of implied volatility over historical volatility. And both are moderately distressed at the moment.

I had a third candidate - AGIX but when I looked at the implied volatility (IV) it was 180%+. This is a red-flag to me so I did my due dilligence on the stock and discovered that it is a one-drug small pharma that's been declining all year. It's phase 3 results on its one drug will be released early next year and I'm not waiting for a big hit. And that's why you should look at the IV. It can tell you stories you might want to listen to. Some people might know how to play options with this guy e.g buy stock and OTM puts or whatever - I don't so I won't even suggest it.

I'm going to use Dogwood's method of using the ATR for number of shares to purchase and setting the stop loss. I've tested it and I really like it. I suggest you go over to his site and review the method. It's pretty slick.

I'm working on another method that is pretty complicated and the preliminary results look good. If it works out OK I'll share it with you next week.

These are not recommendations only some thoughts about what I am planning on doing. I do not recommend any stocks nor any trading method.