The Market

Key SPY Pivot Levels: 198.20 : new high resistance, 196.58 20 dma, 193.23: 50 dma

Under the Hood and Trading Game Plan:

I was not expecting the move on Friday.  Sure, I thought we could get a remount of the 20 dma, but I didn’t think we would also retest the highs.  Keep in mind this does not negative any patterns.  We still need to see a break of the highs.  What it has done is change my market bias from negative back to neutral.

Many of the regular high momentum focus list stocks we regularly watch have pulled back to good entry levels near supports.  I have had mixed feelings on how to play these.  On the one hand there are a high number of good pullback setups on low volume.  However, we still don’t know the direction of the market until we get a breakout or breakdown, and the market will greatly influence these stocks.  I have decided to take some shots, again with low aggression.  Position sizes will be smaller.   I am also going to continue to closely watch a few more short setups.

Current Trades

I am still holding AAPL short, and EZCH and TSLA long.  Note that while not on the focus list since they are current trades, they are all still worthy of being on the focus list.

The Trade Journal (I will fully update tomorrow post market)

The Focus List

Last week we talked about having a few stocks in five different categories to key on, but no real entry level focus list stocks.  With the pullback and many stocks pulling back to key support, or breakouts that have pulled back, I am going to include the regular focus list this week.

Notice on all of my picks, they are momentum stocks that have pulled back quite a bit, but are still technically sound.  Volume on the pullback has not been damaging, and price is either above or remounted major support levels.  Stochastics are usually very oversold.  I won’t comment on it for each setup, just look at the chart annotations.

Most of these are trend pullbacks.  BKS, BLUE and BWLD are differentiated as breakout-pullbacks.

BKS is at the bottom of the breakout bar and holding well.  Entry $21.50-22.15.  Initial Target $23.50. Stop under breakout bar or gap level.

BLUE is a breakout that broke down below the breakout bar, but there is a huge gap so that’s not a concern.  It bounced strong off the 50 dma.  Enter on pullback with stop below Friday bar.  Target at $40-42.

I’ve already been burned by BWLD twince, but still love the pattern.  Remounted 50 dma.  Enter on slight weakness.  Stop under Friday bar, target as high as $167.

CTRN bounced strong off 5o dma.  Enter on weakness.  Target around $23.

FB is above the breakout level, but it’s not a breakout due to the low volume and levels of the bar.  Watch for a clean break.  Another entry would be on pullback to the 20 dma.

Another 50 dma bounce play.  Entry on slight weakness.   Target $127.  Stop $115-117.50.

Strong remount of 50 dma.  Enter on slight weakness.  Target $30-31.  Stop under breakout bar.

Z is not the best setup due to concerns about pullback volume.  However, there is so much room to move you can get a really good reward to risk–this makes it worthwhile for me.  Entry at $123, with a sto at $120 and target at $134 gives 3:1.  If target is the old high you’ve got 7:1.

I am not ready to set buypoints here, but these are a few of the short setups I am watching.

Market Leaders

These are stocks that I always watch, though they might not be in my tradeable watchlist, nor are they actually always leading the market.

GOOGL broke out nicely post earnings.  We will watch this closely, as I expect it will be a focus list stock soon.  Many here are on our focus list, and those that aren’t are still technically healthy.  For the market to break, these will have to start breaking as well.

Please read the post 23 Laws of the Part Time Swing Trading the Market Speculator Way.  It is important to know these rules if you trade off the Report.

New subscribers and trial members please leave me any feedback/comments in the comments, via email (singhjd1@aol.com) or twitter (twitter.com/PaulJSingh). 

The post Market Speculator Part Time | Swing Trade Report appeared first on Bulls on Wall Street.

Thoughts on charting, big money and inside information.  SPY and IWM analysis.  DAL added as short setup.  Key oversold bounce setup levels for market leaders.

The Market

Key SPY Pivot Levels: 198.20 : new high resistance, 196.47 20 dma, 193.02: 50 dma

Under the Hood and Trading Game Plan:

We have been waiting for a day like today.  A day where we get a good clue in finding out what the market wants to do.  SPY backed off from highs and took out the 20 dma with ease.  The key here is that it was on high volume.  Even if we bounce here, I believe we are still in pullback mode and the 50 dma will come into play soon.  That is my current market bias, that we will get to the 50 dma.

Does that mean we load up on shorts here?  No.  The move today was too big.  However, if we get a bounce to the 20 dma, or even a little higher, I will deploy a few short positions.

IWM broke the “line in the sand” we talked about yesterday at $114, easily taking out the 20 dma.  It is now sitting right at the 50 dma.  It is tough to short here, but a bounce would be a good opportunity.

Notice on this chart the “hammers” or long tail candles that have been circled at support levels.  These have been fantastic areas for getting long.  We will stalk these candles at support levels and try to enter near the close of the day when they develop.  They could print anywhere in the $108-111 range.

So if trading IWM, the trade is to short strength and enter on extreme weakness, best when hammers have formed.  For those looking for extra leverage, use TNA or UWM to go long, and TWM to short (you short by going long TWM).

While I have noted some trades around the indexes, this is no time to get aggressive.  We can still let things play out more.  I am going to look at the indexes and some oversold bounce (rubber band) plays for individual equities, along with shorts on pullbacks to resistance, but these will be smaller positions and I will not be using even close to all of my capital.

Thoughts about Charts, Big Money and Inside Information:

Often you’ll hear some money manager talk down on trading charts, or you’ll have someone say your analysis on SPY was “lucky” because of the Malaysian Airliner event (this happened to me today).  While charts may not be the be all end all, they offer clues that you just can’t find anywhere else.  They offer clues to what the big money and insiders know.  Did they know an airliner was going to get shot down today?  No, I am not that much of a conspiracy theorist.  However, I do believe that certain “very important persons” were privy to more information, inside information, that tensions were on the rise and that there were increased odds that  *something could* happen.  That was reflected in the charts, even while we were reaching new highs.

The charts helped us prepare.  They were speaking to us, letting us know it was time to pullback a little.  That something was going to happen.  That is why we have been less aggressive (and some of you wisely not trading at all), over the past week.  Losses, while more numerous than normal, have been kept to a minimum.  In time the charts will talk to us again, letting us know when to get aggressive (either short or long).  We’ll be ready when that time comes.

Current Trades

I am still holding AAPL short, and EZCH and TSLA long.  AAPL is breaking down just as our negative divergence setup predicted.  Those looking to enter still can on slight strength.  EZCH is holding the breakout range.  TSLA is close to stop out, but the pattern is still fine.

Today I also entered, and was stopped out of DUG.  This one was frustrating as the analysis was spot on, we just got stopped out before the stock bounced back.  It happens . . .

I talked yesterday about stop gunning and I fear this is what happened with DUG.  Notice that the low today was just under the low from yesterday, right where many likely had stops.

The Trade Journal 

The Focus List

Last week we talked about having a few stocks in five different categories to key on, but no real entry level focus list stocks.  With the pullback and many stocks pulling back to key support, or breakouts that have pulled back, I am going to include the regular focus list this week.

CODE has pulled back and still looks good.  I would allow for a deeper pullback due to market conditions.  Same goes for BKS.  EZCH is still holding support.  MATX is still a nice breakout setup, but with market conditions I would wait for a pullback into the gap fill area to increase the reward to risk ratio.  GWPH is right at a key support level at $80.  If that breaks it would become a good oversold bounce setup in the low to mid 70s.

Note that KS is a short setup–but not near entry right now.

New Additions:

We’ve had DAL on our shorts watchlist recently, and today it broke down off a textbook breakdown-pullback setup.  I would like to short it on strength.

All of the stocks in the shorts category below are in the midst of forming nice setups.  I am watching them closely.

Here are the categories we started watching during last week’s pullback.  Click on stocks for charts.

1) get extremely oversold and near major support for bounces (rubber band setup) I am not just looking for oversold readings here, I am looking for extremes.  We are not there yet on most of these.  There needs to be more selling, price nearing important support levels, and extreme readings.  At that point we increase the probability of a bounce.  If SPY can pullback to the 50 dma (see chart below), a bunch of these will setup. GWPH, IPXL, KS, EZCH, Z, TWTR, YY, Z, TSLA

2) stocks and sectors that are holding up well (possible rotation or new leaders) Energy, metals, gold, silver, apparel BKS, FANG, PTRY, BWLD, CTRN, TAP, CODE, GMCR, X, FCX, XOM, COP, CZRO, NOV, CLR, AA, MATX

3) stocks that reverse off big down days intraday (hammers) UAL, LUV, JBLU

4) Select shorts AAPL, AKAM, KS, SDRL, GRMN, MSM, SDRL (GOOGL removed)

5) Pullback shorts (bounce to resistance after big drop–often was a rubber band trade) We need to wait and see for this list.  Many will come from the stocks that bounce after extreme drops.  Big Drop – – -> bounce – – -> short setup if bounce on weak volume and price action

Market Leaders

These are stocks that I always watch, though they might not be in my tradeable watchlist, nor are they actually always leading the market.

I was actually rather impressed with how our market leaders held up.  Usually big momo stocks like these get hit very hard.  We did not have any technical breakdowns.  I actually would have liked to see a few to get some rubber band (oversold bounce) plays in motion.  Right now I am targeting TSLA at 200, AMZN at 330, NFLX at 400, FB at 62, GOOG around $560 and Z at 110.  We likely only hit these numbers if SPY pulls back near the 50 dma.  If it does, it wouldn’t be until next week.

Please read the post 23 Laws of the Part Time Swing Trading the Market Speculator Way.  It is important to know these rules if you trade off the Report.

New subscribers and trial members please leave me any feedback/comments in the comments, via email (singhjd1@aol.com) or twitter (twitter.com/PaulJSingh).  

The post Market Speculator Part Time |Swing Trade Report appeared first on Bulls on Wall Street.

Also if you are interested in our trade alert services check them out here.

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SPY holds 20 dma.  BWLD confusion.  Latin Banks.  Mostly waiting for market to play out.  Holdig DUG and AAPL short.

The Market

Key SPY Pivot Levels: 198.20 : new high resistance, 195.63 50 dma, 192.02: 50 dma  and old high

Under the Hood and Trading Game Plan:

If you have not already, please read Monday evenings Report, along with the update with stocks.  It still very much applies.

SPY held the 20 dma today, which is positive but does not predict the future.  We will continue to wait and see if it holds.

The best place we can enter long is a combination of the 50 dma and stochastics hitting oversold levels.  This would give us a strong probability of a bounce trade.

Take note that since mid-May, there have been 4 strong down days (both volume and price), with only one strong up days.  The move has been a “float” to new highs, which does not build momentum.  We have continued to play the float up, but understand that the likelihood of a strong pullback is high.

The game plan is the same.  We mostly sit on our hands until the market gives us some clues.  If taking positions, do so with small position size.

Current Trades

I am currently holding DUG and short AAPL.  I exited BWLD when my stop was hit.

There was some confusion today about BWLD due to my second BWLD alert detailing the bounce.  It was my mistake confusing my BWLD daytrade with the swing trade.  Those of you who were stopped out, I was too.

  Here is the Trade Journal. YY, AAPL and BWLD entries still need to be added.

The Focus List

We are doing the focus list a little differently for the time being.  Here are the stocks being watched in different categories as the market shakes out.

Most stocks did little or bounced within range.  Not much setting up yet.  The hammer reversal stocks were all up big (JBLU, UA, LUV).  Today we have 3 stocks that put in big reversal hammer candles: Z, COP, FANG.  If trend resumes, these should mark the bottom for these stocks.

1) get extremely oversold and near major support for bounces (rubber band setup)

I am not just looking for oversold readings here, I am looking for extremes.  We are not there yet on most of these.  There needs to be more selling, price nearing important support levels, and extreme readings.  At that point we increase the probability of a bounce.  If SPY can pullback to the 50 dma (see chart below), a bunch of these will setup.

GWPH, IPXL, KS, EZCH, Z, TWTR, YY, Z, TSLA

2) stocks and sectors that are holding up well (possible rotation or new leaders)

Energy, metals, gold, silver, apparel

BKS, FANG, PTRY, BWLD, CTRN, TAP, CODE, GMCR, X, FCX, XOM, COP, CZRO, NOV, CLR

3) stocks that reverse off big down days intraday (hammers)

UAL, LUV, JBLU

4) Select shorts

GOOGL, AAPL, AKAM, KS, SDRL

5) Pullback shorts (bounce to resistance after big drop–often was a rubber band trade)

We need to wait and see for this list.  Many will come from the stocks that bounce after extreme drops.  Big Drop – – -> bounce – – -> short setup if bounce on weak volume and price action

I usually don’t add the breakouts/breakdowns that I am watching to the focus list until it is close to entry, but since we are playing the watching game right now, here are a few that I am watching develop.

Breakout: AA, MATX, 

Breakdown: GRMN, MSM, SDRL

Market Leaders

These are stocks that I always watch, though they might not be in my tradeable watchlist, nor are they actually always leading the market.

Lots of meaningless bounces or holding the line.  The healthiest action was in FB.

Sector/ETF analysis

Latin Regional Banks . . .that’s where it’s at right now.  It may be time to dig deeper here.  If the market corrects, this, along with airlines, have a chance to be the new leaders.

Please read the post 23 Laws of the Part Time Swing Trading the Market Speculator Way.  It is important to know these rules if you trade off the Report.

New subscribers and trial members please leave me any feedback/comments in the comments, via email (singhjd1@aol.com) or twitter (twitter.com/PaulJSingh)

The post Market Speculator Part Time | Swing Trade Report appeared first on Bulls on Wall Street.

One of the many questions I get from my students is “when can I trade with real money” .  Its really the thing on all traders minds.  One of the tenets and promises I expect from my students when they take our TRADING BOOTCAMP  is that they don’t trade live while the class is on.  That’s even for the most accomplished of my students. Many of the people that take our class have been trading 10 years plus but need to get to the next level. They need to get more consistent or learn to trade larger size or have more setups in their toolbox.  But most of them are brand new and so its really important to start off on the right foot and make sure to learn the material and finish the program before one goes live.  The coursework is really only have the battle as that is just book knowledge.  You can see a pattern on a bunch of slides in class that I have handpicked but that doesn’t mean that you can trade.  A trade has dozens of variables beyond just pattern recognition which is just step 1. Even if you can recognize the pattern and think you know all the angles can you do it in real time during market hours? That’s a whole different ballgame.  That’s why we have all our students spend time on a trading simulator.  This simulator is a real life trading platform and we simulate the exact conditions you would see when your trading your own account from size of account, commissions, margin expense etc.  You literally need thousands of repetitions of practice before you can make the leap to trading without emotion or thought.  You don’t just make it to the NBA without thousands of hours of practice.  You don’t just become a brain surgeon without thousands of hours of study and practice.  Being a trader is no different.  Your skill has to be developed and then worked on constantly.

Here is a conversation I had with one of my students John. John had done pretty much everything I had asked him to do and more.  He really displayed an incredible work ethic but also his passion for trading on a daily basis.

[screencast url=”http://screencast.com/t/bNB7Du5ZS” width=”” height=””]

[screencast url=”http://screencast.com/t/nGH6Gq2VukuK” width=”” height=””]

So is John ready to trade live?  Has he done the right things?

I say yes.  Look at all the goodness he has in his emails.  All these things are necessary to trade with real money.

1. Complete Trading Bootcamp (28 classes 60 days) finish projects/homework/participation grade in google+ community

2. Develop a toolbox of GOTO trading setups that will allow you to trade in any market condition.

3.  Build a Business Plan for your Trading Business (if you tried to open any million dollar business you would need a biz plan this is no different )

4.  Trade on Simulator successfully hitting all metrics (one should be profitable 4 out of 5 days a week for a month )

5. Do detailed review of Trades & archive them in journal format for Teacher to review

_______________________________________________________________________________________________

So what did John have?

1. detailed metrics of his trades all archived and journal and tagged by setup on our trading simulator.  He knew his win % vs loss % he knew avg gain vs loss per trade and per day.

He also tagged his setups so he knew his win ratio for each setup.  A big part of trading is finding your GOTO setups and really focusing on those setups. Cutting out

the setups that consistently lose you money or have a less % win rate can really boost your results but you need the DATA!

2.  Business Plan- He wrote a 16 page biz plan!

[screencast url=”http://screencast.com/t/WdQVCVFy9W” width=”” height=””]

3. GOTO setups: He had detailed reports on which setups he was fantastic on so we know what to trade and what size when we go live.

4. Near daily contact with teachers & community of students (this is huge you need to totally immerse yourself when learning)

SO IS HE READY? i think so!  This is the gameplan for when someone starts trading live.

The key is to trade small and build the habit of winning and finishing in the green. The hardest part of trading is going from being a losing trader to just finishing green. even up a dollar. The beginning is not about trying to make 5k in a day.  Its about building good habits learning to trade your setups to the fullest and extract what you can out of them. When a new trader trades to large size he/she will sell everything to quick when a stock goes up as they are just trading their profit & loss rather then the setup. But then if the stock goes down the loss will be much larger then those small gains they took profit on.  Winning is a habit too so trading a small size  and focusing on being profitable will allow you to scale in larger size and you wont notice any emotional impact. As you slowly build size you will  see yourself as a big time trader and your stress of the larger positions will be the same as when you were trading 100-200 shares.

1. Trade small- Max 200-300 share size.

2. Profitable 4 out of 5 days over 2 weeks then move to 500 shares.  Each 2 weeks review and add size if successful.

3. If weekly stop loss is it work with mentor/peer group on game plan for next week to pinpoint issues.

4. Still archive and journal each trade for review.  Keep building your toolbox of setups.

This is the best way I know how to do this.  Everyone wants to come in like gangbusters and trade huge size the first week and make a bunch of money. But its never happened that way. I have seen hundreds of traders go overboard and just jump into trading without properly taking these steps and doing the work necessary to be successful.  Not a single one of them succeeded till after they came back into the program and did things the right way with no shortcuts.  everyone naturally thinks they are very smart and the exception to the rules but everyone at some point will have to do things the right way. Either in the beginning or after a couple rounds of failure!

If your are interested in learning to Trade our Trading Bootcamp Starts November 5th https://bullsonwallstreet.com/trading-bootcamp-starts-november-5th/

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