Tuesday Follies

Stopped out of CRVL - what's new - I think I'll have to wait a bit for a breakout on that one.

Added MDRX in its place. I took MDRX off the fact that the market is going down today and it is going up. That is sometimes a good indicator of a "must have" stock. Of course I set a very close stop in case it changes its mind.

Watching the 5 minute USDJPY chart and it appears as if the world is trying to reverse. We'll see.

Wrapping Monday

Did anybody see what happened today?



After I saw the Yen become stronger against the dollar this morning I wrote a post "Forex Alert" and said - this won't last long. I was right.



I don't know about you but it looks to me like the USDYEN is almost a dead ringer for the QQQQ - still.

But the neat thing about the Q's is that they rebound from Support 4! and went all the way to Resistance 1. This was poetry in motion folks. See the tweezer bottom at Support 1? Then there's a tweezer again with a BOB a little while later. I love days when the market dips quick and then starts coming back - doesn't do my trading portfolio (swing trades) so good but for day trading it is the best.

Unfortunately I missed it - I was at the hospital taking a test - no problem - I passed - but I sure wish I had been here for the show.

Lost STD to the stop loss - added RSH, IN, and CRVL in place of WEN and STD. Added some to OI on a tweezer bottom near Support 1.

So you want to day trade with the big boys -



Two points off Support 2 and turns around and goes to Resistance 1. AAPL was about the same - MSFT went up but more slowly.

This guy started its move down - still overbought but moving in the right direction -



And that is a good thing. The up/down ratio stayed at 50% and the VIX moved closer to 10 under MA 10. The INDU ATR moved back up again today to 131.28. Not too much but every point higher means more delay on the recovery. We are still overbought and there just isn't any way out of that so I'm forecasting another down day tomorrow.

I'm calling today an up day because two out of the three major indices went up.

The coin, in celebration, calls tomorrow ... tails - down.

That makes the score Marlyn 22 - 19 and 8 and the coin is 23 - 18 and 8.

CRVL - About Time

Breakouts are some of the most profitable trading for both swing and long term holders and I believe that CRVL has broken out -



And here is the pivot point model -



It has taken awhile but I think this stock is finally ready for a buy signal. I'm going to add it to my trading portfolio today.

Traders Action Zone

Everyone who reads this BLOG recognizes this as what I call the Return to 4 (which can also be a return to 8 or a return to 21) -



And I'm deliberately using this particular stock because I wanted to show that you don't have to have a gap-up to obtain the same basic results from the same basic rules. But this guy, Taz Trader, calls it the Traders Action Zone and describes it thoroughly in this post - Trading Pullbacks.

So go read about it on his BLOG because he has some interesting things to say and shows a neat idea using the 10 SMA with the 30 EMA. And there is nothing wrong with that.

This is not an endorsement of TAZ trader's commercial site - just some good ideas my readers should know about.

But be careful waiting for pullbacks because sometimes this is what happens -



And you miss most if not all of the move. But if you came upon this in late June let's say you would be hard pressed not to say to yourself - Hmmm - 10 SMA crossed the 30 EMA, last two weeks pulled back to touch the 30 EMA - I think I'll take a flyer - and voila - profit. (CRVL had a 3 for 2 split so the prices shown are not the prices you would have gotten at the time).

Is CRVL Ready - Finally?

CRVL is a stock on the decline - it hit a wall several weeks ago right after announcing. There is no apparent reason for this swoon except that it made its number and then some (double) but didn't announce another stock buy back program. At least that's my guess. Of course it is possible that people started to notice that there were 45 insider transactions in the last 12 months and 41 of those were sales - or that of the 21 insider transactions in the past 3 months 21 were sales - I don't know what is going on there but it looks like a lot of insider folks are taking advantage of the huge run up in price to finally buy that double-wide they always lusted after down in the trailer-park.

Anyway it formed a nice DOJI star on the weekly charts which is otherwise known as a "dummy spot" so it might be a good stock to watch for a reversal.



The fact that this was a gap down following a red candle makes it a set-up for a morning star. If next week's candle is white/green then it will be a morning star or as they say down on the farm - ake no myojyo doji bike - easy for you to say. At any rate - a reversal signal.

Wednesday's Wrap

Wrap me up - after I found out that NTRI was reporting after hours it took every bit of my strength to not buy it to the extent of my trading account at the close - I mean who wouldn't want a 12% loss on their book three days in a row? Of course NTRI will go up at least 10% tomorrow morning. That you can bank on. (Update - up 16% after hours).

Flat - in cash - no stocks in my trading account - no holdings - nada - I'm clear. As I mentioned I sold everything including CRI before noon. I reasoned for CRI that it wasn't going to recover the losses ever and it might even go down some more since that was its general direction before I took it anyway. Right now I'd rather have the cash for trading rather than being carried as a bump in the book.

Turns out I should have held NEW a bit longer but the way I was feeling at that moment I needed a winner and that was it and I'm happy with what I got out of it. I took KNOT on a blow-off bottom but set my stop way too close and was stopped out - I didn't have my heart or mind in the trade - maybe tomorrow. I think KNOT is going to get back to where it was - it, afterall, is selling dreams and not real stuff like baby wear. Dreams are a lot easier to value. (If you detect the slightest hint of sarcasm here it's probably because there is a little in the air at the moment).

But when you get bucked off the bull you pick yourself up, make sure nothing is broken, and then you either get back on the bull or you go home and hide under the bed - I don't hide. But I did make some changes and you won't see me holding any stocks in my trading account any longer than 5 hours - if that.

Nuff about my woes - I published a new method to find day trade candidates this morning using a filter that would, if completed, find full scale blow-off bottoms. The filter found 15 matches and of the 15 - four went down today and 11 went up. Needless to say today was a good day for "going up" so I won't say that will be the norm - but I will keep track of this in the wrap and we'll see how well it does.

My three favorites were ETFC, SAY, and TTM - but because this was the first time I've tried this I just watched today. I'm going to continue using this method for awhile and see what develops.

Another interesting detail of the day is that small caps went up and then retreated back to the open - or as I say - they round-tripped. I'm not sure what that portends. Is this the age of the large caps? I doubt it - it might be as simple as the small caps are all overbought. And if you look at the IWM, IWN, and IWO charts together with the stochasticRSI(2) you see the incredible variance of the IWM (the index) and IWO (growth component) both being at 1.000 and the IWN being at 0.000! Apparently value was sold off today hard and that was enough to bring the overall index down. So that leaves the only question as why is value being sold off this year? I have no clue.

GOOG, MSFT and AAPL all went up today as did the semi's. Don't start cheering because I think that is just a one day story.

Another stock that took an amazing haircut today was GIFI. Just last week Trading Goddess was talking about that stock as if it had a real chance post earnings. I didn't think much of the stock - it appeared to me to be ready to come down anyway - but apparently the company has postponed its earnings announcement and that was enough for an 11% haircut. See what I mean about the market being so fearful? I don't think the economy is in that good shape - at least not as good as some of our leaders would have us believe. Gold keeps going up and stocks keep exploding. Although it is possible that gold is starting to peak. I think Bernake scared gold traders today when he started talking about inflation being under control - the worst thing that can happen to the gold bugs is an interest rate cut. If stocks keep blowing up I think that is coming - I'm surprised it hasn't happened already. Jimmy Crack Corn Pone also thinks one is due too.

CRVL continued its droppage today. See what happens when the day traders and scalpers abandon you - absolute chaos.

I think GM is done for awhile - third gap up yesterday and a DOJI today.

Now for the most amazing piece of the puzzle - the up/down ratio actually went down today to 55% from 59% and there were about 300 fewer stocks going up today than went up yesterday. That suggests that today's exuberance was indeed irrational. Now despite that the NEWMOMO method is suggesting we are already due for a correction.



As I've pointed out - this is a relatively new method that I'm using and I really don't know what to expect from it but the icing on the cake is the fact that the ATR(10) for the INDU is at 78.99 which is less than 80. So I'm forecasting a down day tomorrow.

The coin says --- tails - also a down day - I have to start letting the coin go first - I think it is playing me.

We both got it right again so the score is Marlyn 12 - 8 and 4 and the coin is 9 - 11 and 4.

Happy trails to you.

Wrapping Tuesday

Bernake speaks - he says - don't worry - education and training will help narrow income inequality. That is - education for those who can afford it - which means parents who can afford it because you don't get through school jerking sodas anymore - not at 5.25 an hour or even 7.25 an hour. Which means - we're screwed. But you all knew that already.

But that's not what I'm here to talk about today - I'm here to talk about this amazing new stock market of the new intertube century - it slices - it dices - it cures every ailment known to man and a couple not even discovered yet - it goes up and down like a psychotic yo-yo - watch the shells boy and try to pick the walnut with pea under it - I'll give you two chances for one money ... would you like to try again?

Wow! Will this ever end? There were so many set-ups coming about mid-day I didn't know what to do. Here's several that you can look up for yourselves (all 15-minute charts) - at 11:45 JNPR printed a dummy spot followed by clear confirmation that also formed a tweezer bottom at 12:00. It took off from there. At 12:45 to 1:15 MSFT formed a classic blow-off bottom (sorry Jim) and took off from there. At 11:30 SYX formed a classic blow-off bottom with a confirmation 15 minutes later. It took off from there. SPY printed a tweezer bottom at the 11:45 - 12:15 on the 15-minute bars. In the 11:45 to 12 time period on the 1-minute bars you can see a huge 2.5-3 million share sell in SPY that was probably one transaction. After that the market reversed.

I took a bit on SYX - a stock I'd never played before. And got out at the dummy spot at 1:30.

Still holding CRVL even though it gave up a buck and a half today - probably get it back and then some tomorrow. Also holding DHI and it is only 20 cents away from where I bought it despite the best efforts of thestreet.com's loyal 10 subscribers. Still holding JNPR - it is in a nice chart formation and I think it is going to continue to go up - I'm looking at 18.90 as a target. I did sell the Q's this morning just as they jumped up at the open because I thought that they were going to go down from there hard. They did, then recovered most of it. Holding KKD too - although the next time it goes profitable I'm out because I think it is done for now. I'll wait for another set-up in the future.

I knew ahead of time that this was going to be a strange day because around noon I took a look at the up/down ratio and there were more stocks up than yesterday and the market was crashing all morning. How can stocks go up with the indices down - damifino but they do and they did.

CSCO beat - that probably means a 20 point day on the NAS tomorrow. GOOG went up today - it too had a classical blow-off bottom 11:30-12:15. Remember the BOB is characterized by a minimum of two down bars (Red) with elevated volume on the second down bar. This is followed by a Green/White bar with a higher low than the last Red bar or an absolutely equal low (tweezer bottom) with the last red bar. That is all it takes and if you see this formation you buy it and put your stop someplace below the low of the Green/White bar. You choose the spot but some multiple of the 15-minute ATR would probably be appropriate. For GOOG at that moment it was about 2 bucks which seems about right. Who in their right mind is going to day trade GOOG? Here is an example of BOB on the hour charts (yes you see it on all time scales). Of course the longer the time scale the longer the run (generally) so if MSFT goes up tomorrow too - don't say I didn't try to warn you.



Nuff of that. The up/down ratio went up today to 43% which is neutral. The new 20-day high/low ratio is 77% which still means an overbought market ahead of us. Four of the five majors finished with white candles in the final hour, only the Q's were down and the VIX remains neutral - if I were the VIX I'd probably want to stay out of it too.

I'm forecasting tomorrow as an up day. I want a downer so bad that I'm calling for an up day (although I'd take one like today but that just doesn't happen that often). It probably will be mixed again, but we'll see.

Meanwhile old magic coin says --- tails - bear market again. The coin just never learns.

Having missed today by the barest of margins, the score is now Marlyn 8 - 6 and 4 and the coin is 6 - 8 and 4. Marlyn is just barely better than lucky (which puts him head and shoulders ahead of Jimmy Crack You Know Who).

Forgot to mention - I absolutely love this stuff - every boring minute of every boring day and I hope that my absolute passion for it plays through in my writing. Have a good evening.

Wrapping Monday

I'm not feeling too well - I guess I picked up a bug last week when I was on the road. Probably not too difficult when you observe how many people cough without covering their mouths with their hands at least. Anyway I have a miserable head cold so I'm mostly watching today and thinking.

I saw an opportunity to grab some DHI on a minor pullback so I took it. I bought it on a blow-off bottom around the noon hour that was also a tweezer bottom on the 15-minute charts. Then at 4 minutes to the close I bought a load of JNPR based on a report I read in Notable Calls and the fact that it too was forming a bottom in the final hour of trading. I will probably sell this one tomorrow.

That makes the load CRVL, KKD, still holding the Q's even though they are profitable and I swore I'd sell them, and now DHI and JNPR.

I was going to buy FNF but it just didn't look good to me. It will probably report good earnings and go to the moon tomorrow morning. But maybe not. I don't have a feel for it and I still don't like holding stocks through earnings unless I do have a feel for them. Of course at about 2:30 it started catching a bid and it went up 60 cents in the last hour and a half. I don't trust after hours so we'll see tomorrow but the earnings were down.

I did notice that GOOG had another "long squeeze" today. A "long squeeze" is when the retail traders sell all their many millions of ... wait, retail traders don't sell millions of shares ... well who's selling then? I don't know but there are a lot of 200 - 1000 lots coming across plus quite a few larger than that. I can guess that most of these are not retail traders because the time and sales window is color coded and most of the trades are in cyan - that means the trade is not at either the bid or the ask. Contrast that to a GM for instance where most of the trades are in red or green (for bid or ask). I don't know why GOOG is losing ground - I think it is possible that people are taking profits to pay for Christmas now that the bills are coming in. Yeah - sure.

Speaking of GM - back in early December Carl Icahn sold off his holdings because as he said, and I'll paraphrase - dumbass company won't listen to me so its stock is going to go down. He managed to beat it down to 28 and change in a couple of days and since then it has gained back about 5 bucks - 3 higher than where Carl sold. So much for Carl as stock picker - see just because you have barrels of money doesn't mean you're smart.

But I'd like to do another object lesson on this same theme. Let's say that on Jan 14th or so Jimmy Crack Corn Pone said that GOOG was going to 513 and from there a short squeeze would take it to 520. Let's say that you believed him and with 10K of your hard earned money you bought GOOG on 1/16 at 507 (approx the open) and you got 19 shares. Today your 19 shares are worth 8971. If you had gotten the 19 shares to 520 you would have a 247 dollar gain. If on the same day you had used the same 10K to buy 324 shares of GM it would be worth 10692 today or 692 dollars in profit or nearly 3 times the profit you might have gained with GOOG but didn't.

The point of this exercise is not to ridicule Jimmy Crack Corn Pone (although I can't help myself I really can't) but to show you that you have choices where to put your money - or as your mother used to say - if everyone was jumping off the bridge would you jump too? Sometimes it just makes good sense to buy an old sticks and bricks company like GM. From a traders perspective GM is a great day trade up or down - just watch the Dow and go with the flow.

Broker A over at Fly on Wall Street has a rant up regarding the fact that GOOG should split - and it probably should about 5 to 1 if not more. If it were anywhere near BIDU you'd be able to make direct and realistic comparisons.

Unless you have Marlyn's Curve. I'll do a post later today or tomorrow showing GOOG, BIDU, and YHOO as you've never seen them before - it's pretty neat.

MSFT and AAPL were both down today but MSFT looked to me like it might go back up again tomorrow. AAPL just looks tired and I have a feeling it will be taking a long rest. SMH looked like it put in a maximum top today - three gaps up and a DOJI star. I wouldn't be surprised to see it drop a bit tomorrow. Of course volume is drying up in just about everything. I'm not sure what everyone is waiting for but I don't like this quiet - it's too quiet.

The up/down ratio has pulled way back to 38% and the new 20-day high/low ratio also pulled back to 74% which isn't great and still reflects an overbought market but some relief is in sight. The last hour was mixed with a couple up and a couple down. And that story is getting to be real old too. The VIX has pulled back into neutral territory which is OK but I'm calling tomorrow a down day. And that is based on the tweezer top that formed on the SPY and IWM today and Friday. They weren't perfect but they were within 2 cents of one another and that's close enough for me. Between that and the absolute minimal volume across the board and I think we need a few days of downward movement just to get the pressure off.

Meanwhile in magic land the coin calls tomorrow --- tails - also down.

Let's call today what it deserves to be called and that is another mixed day or what I'm calling a tie. I lost money on my several investments today but they are all green from where I bought them.

The score is now Marlyn 8 - 5 and 4 and the coin is 6 - 7 and 4.

Wrap It Up Friday

Late for Friday's wrap - had some important things to do. Anyway as you may have noticed it was a kind of up and down day but the one thing that stood out was the low volume.

After peaking on Wednesday at 2 million over the average the DIA was 2 million down for Friday. The SPY, Q's and IWM showed the same pattern with IWM coming in at only about half of the average volume.

I think this shows a reluctance on the part of the funds to sell their winners and that probably supports the belief that the bull has some run left. Of course earnings in general have been not too bad and there haven't been any outright misses - yet. But we are getting close to the end of the earnings season and it appears as if everyone is breathing a sigh of relief that things aren't as bad as the anecdotes would have it.

I didn't do much today because I was busy with other things but I did reacquire KKD. I took it at the daily pivot point (12.29) after it had gone below and touched the mid-point low. I was going to sell it at R2 but it never made it that far so I decided to hang on for another day.

An update on CRVL - the other day I said I'd either double or sell and I opted to double. Problem was I was only able to get half my order filled before the price ran away (I won't "market" buy this one) so I only went up another quarter. I'm going to hold a while longer as it made my week this past week and I see no reason to sell at this time.

Monday is looking like a down day even though the cycle should have us going up. This will be the first (full) week of the month and it normally is an up week because of the influx of the retirement fund money. There are mixed signals however because the up/down ratio withdrew to 53% but the new 20-day high/low ratio stayed in the high 80's (88%). The VIX went back into the yellow zone low (-5-10 below 10 day moving average) and 3 of the 4 indices finished the week with stong white final hour candles. Only IWM finished in the red. I think that there is just not enough out there to buy and that the stress on the system caused by the huge number of new 20-day highs is going to be enough to knock the market down a little on Monday.

Meanwhile the coin says - - - tails - bear market. We agree again.

Nothing to be said about Friday except another mixed day. The score is now Marlyn 8 - 5 and 3 and the coin is 6 - 7 and 3. I wonder what all of these mixed days are going to mean? Six months last year we had 1 so far we've had 3. Stay tuned.

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.

Tale of Two Stocks

Today’s lesson, kiddies, is how to recognize a short squeeze on the 15-minute charts and how to recognize the difference between a scalper’s stock and an investment stock.

First I will show you one of the scalpers latest favorite – CRVL. Friday's chart provides an excellent example of a blow-off bottom. The reason why it is a blow-off bottom is because the shorts have to cover. Later in the post we'll show you why the shorts had to cover but once the buyers came out in force and started picking off the offers the stock went up. Because the stock is a low volume trade it can be moved very quickly in price. Consequently the shorts need to move very quickly to ensure their profit. Consequently the price rises rapidly.

If you watch the bid – ask for awhile during one of these buying-selling sprees your head will spin. Occasionally there is a 15 or 20 cent variance. When I want to buy some I put my limit price between the two and it gets hit quickly. I wouldn't use a "market" order in this stock because "market" has no meaning.



Towards the end of the day the day traders start bailing out and the price oscillates with some very large volume - relatively speaking. That is an ideal scalper's stock - low volume and lots of mo-mo. (Mo-mo is a roaring 90's term for "momentum" - I know - so last century).

Compare that to YHOO, which is an investment grade stock. But even in YHOO a blow-off bottom is a blow-off bottom - except in YHOO the volume is in the millions and the price can't be easily manipulated by a handful of snot-nosed kids in their mommy's basement. But the same dynamic applies - traders are short the stock - the market starts moving against them and they have to scurry and cover their bids. Notice too that with YHOO there was no end-of-day bail-out. I will discuss the significance of this at length in a subsequent post this weekend.



You can make money in either one of these stocks - just watch for the blow-off bottoms - if you are careful with CRVL and keep the sharks from eating your lunch you can ride that puppy too.

For those of you who don't want to sift through dozens, hundreds, thousands of charts a day you may simply want to watch the Q's. It too will show the blow-off bottom and when it does you know it is time for a feeding frenzy. So this is what the traders saw occurring Friday at 10:30 - the Q's started to rise - this brought terror into the shortist's hearts and they started to grab every offer in site.

Wednesday's Wrap

I had a busy day - I was out most of it but I was able to take two trades this morning before I left – CTXS on a 15-minute crossover with a confirmation and CRVL on a buck 43 gap down. Let’s address CTXS first – I’ve talked about the crossover several times this week and I think you all know what it looks like by now. But in case you forgot here is a picture – worth a thousand words – for me it was worth a thousand bucks – well, 763 actually but that isn’t too bad all things considered equal.



You can see how the second 15-minute bar transects the three averages and the third bar confirms. I've been watching CTXS on various time periods and it looks like it is setting up for a long term run. Here is how it looks today on the weekly charts.



Now remember we need to finish out this week with a green/white body and have a confirmation either next week or the following week before we can safely take this one. I know - it takes the patience of a Saint but that's the best way to play the intermediate or swing game - with patience and careful selections.

Now we’ll talk about CRVL – this stock is a day trader’s wet dream – lots of action, much up and down but mostly up. I’ve been watching this stock for a couple of months – actually ever since I first read about it over on the Goddess’ site. Subsequently I figured it out – it often opens on a gap down and then claws its way back to the surface – a buck and a quarter to a buck and a half is about the daily range. So when I saw it at minus a buck and change this morning I said gimme some no need for a set-up. In at 42.31 out at 43.60 and thank you Ms. Goddess for the tip (She plays it for a lonnnng tiiiime – I day trade it – who’s right? who’s wrong? who cares? – Truth – she’s right because she caught it on a dip and has ridden it long and well since. – Truth - I am because I’ve made taksan okani* off the little beast and its’ hordes of day trading demons and I plan to keep on keepin’ on). Remember these thinly traded stocks only work when there is day trading action and I told you yesterday how to put your limit between the bid and the ask because any semblance between those two and reality is purely coincidental.

Fact is I make more money on these weak start days than on any others. I don’t know why that is but had I been home all day I would’ve played HANS and GM and any number of other boomers. Even Glass (GLW) took the blue pill this afternoon. Looks like it might have taken the whole bottle.

Of course at the end of the day SYMC (my swing trade) is down 11 cents with the Naz up 15 skins. But I said I’d play it through Friday and if it doesn’t show me some real love by then – goodbye SYMC. (I long ago stopped using it on my box having found far better products for far better prices (mostly free)). My few shares of DHI managed to lose 6 cents today. I think that's a good sign because it appears to have been sold out and now everyone is waiting for a reason to buy it. Me too. I have my target in mind and if it breaks the target I'll buy back my shares. Meanwhile the money is being put to good use in scalping CRVL and day trading stocks like CTXS.

Meanwhile the up/down ratio actually lost ground today to 42% which is good and the new 20 day high/low ratio only obtained 40% and that's OK too. The VIX remains neutral but all 4 majors and GS finished the last hour bright and white and that could mean some trouble for tomorrow. I'm putting it all together and saying another up day tomorrow.

The magic coin says ... heads - bull market tomorrow - well we're either both going to be right or both be wrong.

Marlyn is now 2 and 1 and coin is 1 and 2. But it's early in the season folks - don't go away.

* "taksan okani" is Japanese for a great amount of money and is probably the only Japanese I remember from a youth spent exploring the temples and ... oh Bull - runnin' the allies staying one step ahead of the MP's. A very checkered life has led this Marlyn person - indeed.

Wrapping Monday

I wanted to do some of this as a midday report but Blogger wouldn't allow me to upload a figure that I am using later and so I'll do it as the normal wrap.

Maybe tomorrow we'll be able to do a "midday report". Maybe tomorrow Blogger will sprout wings and fly. Shouldn't complain - you gets what you pays for.

Picked up RAD as a day-trade - gapped up and came back to the EMA 4 and that's when I grabbed it up. Same with BSX. Sold off RAD mid-afternoon as it seemed to be done. Decided to hold BSX (convert to a swing) as it looks pretty strong. There were a number of these types of set-ups today - these were just the two I took.

Speaking of the "gap up fall back" set-up, one of Broker-A's favorites, MVIS, did that this morning. MVIS looks like it is finally catching on. They are developing a heads-up display for automobiles - just what we need - another driver distraction. Actually the tech market is so barren of new ideas that any idea sounds great. I mean let's face it how many different ways can you say "telephone and takes pictures" and make it sound new and exciting - twice? So MVIS is being rewarded for innovation if nothing else.

SYMC is up a bit. This one is driving me nuts. I'd be better off day-trading it than holding it as a swing. I'll hang in there one more cycle (4 days) and if it doesn't break out of this range (> 21.80) then I'm out of it. We'll see on Friday. If I do sell it will be your signal to load up. I dumped nearly all of my DHI this morning - maybe housing isn't ready to go up. I'll keep an eye on it and if it turns I'll get my losses back - they weren't too severe but I hate losses.

Picked up some CRVL on a reversal day-trade this afternoon. I sold at COB for a buck and change. I keep this one on my screens all the time - it is a thinly traded stock with a massive spread but I usually buy it as a limit trade by putting my bid square in the center of the bid-ask. Somebody hits it almost immediately. There are a lot of scalpers in this stock. Selling is the same process - put it out between the bid and the ask and some fish will rise to the bait. Trading is like fishing - a lot of patience and knowing where to drop your line goes a long way.

One of my fellow Bloggers - Bullish Jim - bailed on CTXS last week and look at it today - up a buck and change and look out above. Only wish I had jumped on it at open this morning (just kidding Jim). Actually I'm not, Jim. CTXS put out a "buy me" crossing signal this morning and I saw it but got distracted and by the time I got back half the move was made. That "buy me" crossing signal looks like this.



You will see this on just about every time period including daily, weekly and monthly. I use three EMA - 4, 8 and 21 and a "crossing" signal is when the open of the first 15-minute candle is below the EMA 21 and the close is above the EMA 4. When you get a confirmation (as shown in the figure) the next move is up - usually. Sometimes they fool us and go down but that is what risk management is all about. I normally set a stop just below the EMA 21 and that is generally sufficient. Readers of this Blog know that I also normally use "mental" stops. (Charts courtesy of Prophet.net - a good company).

This signal, by the way, works for shorts too (red candle crossing down) and works in many different markets. I have seen it work after the open (today NVEC for example) but keep in mind the rules are fairly strict - you must have the crossing and the confirmation before taking the trade.

I keep an eye out for this signal on my various watch lists that I have set up 24 to a page and start going through 15 minutes after the open. If I see the indicator I copy the stock to another watch list for the next 15 minute scan.

As for tomorrow - the up/down ratio is back to 52% (erroneously reported earlier as 60%) and the new 20 day high/low ratio is at 35% which is mixed. The VIX is still more than 5% greater than its 10 day moving average which, while not a hard and fast indicator, does suggest a certain amount of oversoldishness. The four indices that we track (via their ETFs) all finished the last hour in the red and GS finished with a doji. That last is understandable given the 4+ point gain it had today - poor guy had to be plumb tuckered out. Or as we New Yorkers say - "Dat guy is f'in tired." Put all of this together and it spells - another up day tomorrow. And that's my prediction.

The magic coin says - tails - bear again.

OK the score so far is Marlyn - 1 and 0 --- Coin 0 and 1 - the race has begun.

Wrapping Crappy Wednesday

Man I’m getting sick of these boomerang days. Up we go, down we go – around we go – nobody knows where we want to go. I want the market to go down and go down hard. I want that to happen in the next 10 days. That will give us a good set-up for the next year. It won’t of course – don’t know if you’ve noticed or not but there just isn’t any volume in this market. All of the indices ETFs that we follow are at half speed if that.

I’m still holding SYMC although I wish I had sold this morning early and I picked up some DHI and was probably a day or two too early on that one. Dumped out of WFC – a 9-cent gain off a three-day hold. Could have had 9-cents after the first three minutes. Sometimes you just waste time although a profit is a profit. Sometimes they are so boring you just have to kick them out of the portfolio. WFC fit that profile to a T.

I took a day trade in CRVL. That chart's below – I took it on the fifth bar where it "kissed the 8" and dumped out right at 48 – that was my target and I had to go shopping again. Good thing – looks like everyone else had to go shopping too. MAMA would have been a great trade again today – as I mentioned in my post on cheap stocks – MAMA and MVIS both were showing some support on the monthly charts. MVIS hasn’t been doing much but MAMA has been running pretty well.



I’m getting sick of shopping. I read a column by Barry Ritholtz this morning on Seeking Alpha containing anecdotal evidence that the season is lacking in the retail sector and I’ve got to tell you – I agree. I’ve been out almost every day in December and in years past where I would have had problems with parking – no sweat this year. Also we have had some lines but nothing too difficult and an awful lot of stores just don't have anybody in them. Not the big boxes of course but a lot of the specialty shops. I don’t know what that means for certain but I think it bodes ill for the retail reports in January. That will mean a one-day market decline at best and then ho-hum up we go again. Adam on the Daily Options Report said it best – he called it “relentlessly plodding upturn.” That pretty much nails it.

I really thought we’d have a good day today – at least go up and stay up but there are a lot of profits from the “relentless upturn” and somebody is taking them. Possibly the funds – setting the end of year markers – the retail trade is too conditioned to wait for January to take profits and there are hardly any losses to take this year.

For tomorrow the up/down ratio went up to 48%, the new 20-day highs gained ground and the new 20-day lows lost ground. Everybody went red in the last hour except IWM. The small caps had a great day. The VIX slid back inside of 5% below its 10-day moving average.

This all sums up to a great big – I don’t know. I’m going to sit on my positions through the holiday and see where we go next week. I'll watch CRVL and MAMA and a couple of others to see if I can get a day trade but other than that I'm pretty set where I am.

The magician is now at 38 – 29 having called today correctly – I should have listened and not played DHI – oh well sometimes you have to believe your own stories. I still think homies are over-sold and I'll get 10 - 15% out of DHI yet. I'm looking for a about a buck-60 with no real downside risk. For tomorrow – magic says --- tails – more bear. Could be.