Telechart Scan

A simple scan I like to use is to scan for stocks above their 50dma, and have pulled back for three days or more. The 50dma mean's nothing in and of itself, but it mean's some thing to a lot of big fund manager's and trader's, and it also represents strength in a stock. The three day pull back is a staple of the Pristine Method, as this is a PBS, Pristine Buy Setup. Another positive for this setup is that a lot of BZ's system's that I run, BZ Trader , like the popper's, test out even better, as far as the buy side setup, when the RSI2 trigger's a buy when the stock is above the 50dma. PLUS, the 50dma is a common parameter for sentiment read's, for over bought and over sold reading on the index's, as a percentage of stocks in the index above or below the 50dma.

The Russell 3000 is the top chart, and the total ETF's is the bottom chart. Of the 2875 stocks (I have no idea why there's not 3000 of them, hmmmm) in the Russell, 2411, or 84%, are above their 50dma, and of those, 17, 17!, have pulled back for three day's or more, an incredible number as far as I'm concerned, incredibly low that is. Of those 17, I only found FLR to be moderately interesting, mainly because it's considered to be one of the beneficiaries of Barrack the Builder's stimulus plan, that is, part of the measly 60 billion that is ear marked to create actual jobs, out of the approximately 9 trillion that has been pumped in by the government, eeeeeeeeerrrrrrrrrr, the "tax Payer" (those are the words that no one ever mentions, it's always "the government" putting the money up). The only positive I see about FLR is that it has saddled back down just above the 50dma, and put a wide range indecisive bar on it yesterday. Tfhe negative's are that the 50 is still sloping downward, it has a ton of resistance or supply over head, up to about 42, and TSV is below the zero line. I would probably have to wait until it get's over 42, for if it does, it has a lot of clear air above that point, all the way back up to about 50.

Out of the 793 ETF's in the entire universe, 644, or 81%, are above their 50dma, which is a pretty incredible number when you consider there are a lot of inverse ETF's that are sucking the big one right now. Out of those 644 there are 2, 2!, that have pulled back for three or more days. I don't care for either one of them, both are low volume, and the SWH gap's all over hell and back. SWH would be more interesting if TSV was not decisively below the zero line, I want to see TSV stay above the zero line on a pull back. Speaking of TSV (time segmented volume), it gapped to a new rally high at the arrow, while TSV made a lower high, IE a divergence, and promptly pulled back for three days, gapped up and tested that high, then chopped around, and blasted off to the new rally high 6 bars ago, and all the while TSV continued to go down, indicating thing's were not all that they seemed. But just like a lot of regular indicators, the Boyz can continue to try and pump this thing higher, levitating it so to speak, it the face of waning interest, a lot longer than I can stay solvent trying to short it. Eventually of course, they get tired of trying to suck Mom and Pop in, and give it up. I bring this up, because the Q's had a TSV divergence all this week, accept for yesterday, when we got a little hook in it, maybe it will pick up some interest next week.

5/1/09

5:30pm: The MSW will be updated this weekend for weekly setups, and swing and 7-day moves.

2:15pm: The Q's had a chance to finish in a flat dead ass doji, if it hadn't been for a pump the last two minutes to get it into the green ahead of the weekend. That's it, that's all the comments I have.

I have decided to make a career change. I've been thinking about doing it for some time, and this being a day with some deep meaning for me, an important day to me, I just decided to go ahead and make the move. I'm going to stop day trading, period, endso, caput. This is not a sudden decision, I've been tossing it around for quite a while, most of the reasons are personal, mostly related to things like I haven't been looking forward to the grind, I used to wake up at 4 in the morning and couldn't wait for the market to open, that just hasn't been happening for while. There's a lot of other reason's, mostly personal, some financial, change of life type stuff, wad ever.
My plan is to take some time, and do more research on the sources available to me in Telecharts, get a little deeper into that, I plan on working on my MSW, a LOT, and doing more work on system testing in TradeStation, one of the things bothering me is that the McClellan system has just been kicking my day trading ass results, hahahahaha, I'm not complaining mind you, it's just that I have a chance to move into some different area's of trading, that I'm currently finding more interest in, especially like pair's trading, more asset allocation work, and more work on my option spread trading, more sector based trading, a LOT more, especially in paired sectors trading, etc etc etc. Basically, I plan on doing more swing and position type trading, mostly swing trading.
I don't plan to stop posting, I'll definitely be posting the MSW stuff, probably more of it, as soon as I can do some more work on it, and test out some different parameters, and see what it has to offer that I haven't had time to find out about. I plan to maybe take a month, or two, or what ever it takes, to do some research and testing. I will probably cut down the general market commentary, unless I see some thing REALLY interesting.

Anyway, that's my plan, be that what it may, I'm actually kind of excited about it, new STUFF, woooooo hooooooo!

7:00am: Futures are up slightly this morning, actually, basically flat, as we get towards the end of the "usually" bullish last three days of the month, first two days of the next month, trading "system".

So, speaking of systems, I ran the ETF's through the MSW "Swing" and "Seven Day Move" profiles, just to see how well it works on short term trades, and as I would expect, the results are a little mixed, but worth looking at. One of the first thing's I look at are the three columns onthe right side of the Focus List to see how well it trades individual stocks, the BTHR, BTAPR and BTPr colums, and one thing that jump's out at me right away, is it definitely trades the leveraged ETF's very well, as evidenced by the result's for FAS and FAZ. When I look at it, it also does well on TNA, DXO, UYM, and it also does well on certain "normal" ETF's, like USO, XLE (it seem's to love oil), SMH, UNG, XLB, UGA, etc. The next thing that immediately smack's me around a little, is that it can't trade the main index's worth a damn, like BND, SPY, DIA, RTH, FXI, and a few others, which makes me think, that if this thing can't trade those index's, why should I be messing around with them, hahahahaha!! It actually does "fairly" well on the Q's, maybe that's why I trade them.

I'm old, and therefore a little slow, but the reason I have FAS and FAZ up there, is that I'm wondering, since they are both around 8 bucks, and both have come down from MUCH higher levels, $110 in the case of FAZ, would it NOT be impossible to lose money, if you brought equal share amounts of both?????? I mean, which ever one goes down, can only lose 8 bucks, or your total investment, while the other one has the "possibility" of going back to ten times higher than it is now. I'm sure that I'm missing some thing here, I would be interested in hearing from one of you brilliant reader's if you figure out what I'm missing.

In loving memory of Carolyn Gibson Hargrave.

MSW 4/30/09

There was no change on the ETF's today.

The software came up with 10 new buys and 32 new shorts, obviously, it's leaning in the short direction, the new shorts not shown are COH, IPI, BKCC, CCOI, CKP, MALL, DNDN, CHUX, GLT, IBAS, ABBC, AXB. I went over all the charts in both the daily and weekly scans, and to be honest, I didn't see any thing I particulary liked, I only have PNRA on the chart, because it seem's to think the casual dining operations may have run their course, the short it put on DRI the other day is still working.

4/30/09

2:15PM: I had one little mickey mouse scalp on the five minute, at 10:25am at the arrow, we had an avalanche setup, we had a thrust bar about six bars earlier, then a couple of follow through bars, then the little three bar rally, I took the failure bar at the arrow when we failed to hold the break over the high of the prior bar, and close under the open of it. I bring it up mainly because it was actually a lousy entry, that was actually the setup bar, and I should have waited on the next bar to take out the low of the bar I took, if you followed that. Anyway, my stop was over the high of the bar I took, and we dumped two bars later, when ever I make a lousy entry, I get antsy right away, so I took half off at 8 cents, moved the stop to break even, and was looking for a target at that 50ma at about .56, but I even jumped that at .58, for 10 cents, hmmmpt, about 8 cents net, wad ever.

The 60min McClellan triggerded a new short at 1:30pm at 34.17.

The daily had another hammer on it, the close did manage to close over the 200dma, but I have to admit, I sure think that QID daily chart looks like a buy to me, but hey, that's just me. The SPY had a break out failure day, AGAIN, as it also failed to hold the break out over the February highs yesterday, and today, failed to hold the break out over yesterday's highs, all really good stuff, honest.

I'll probably run the QID through the MSW tonight to see what it says.

7:00am: SIGH! "THEY", are gapping us up this morning, I don't know if there's any news to support it or not, as I can't use my MSN, and I'm working off the generic Explorer, so it's totally screwed up all my short cuts to my news channel's and the such, wad ever.
The true intentions of the reaction to the FOMC release is usually not revealed until the next day, so with us gapping up about 1.5% across the boards, I have to follow the trend, which is currently, aaaaaahhhh, UP, ungodly as it may seem. The Q's are now solidly above that November high, currently at 34.47, the next resistance is not until that big October 14 bar, in the circle. If you remember, that was like a 10% range day, the high of that bar was 36.15, which corresponds to the 38.2% retracement level at 36.58. The important thing about the relationship to that bar, and now, is that it has left a "void", IE, clear air, IE, no resistance, meaning, if "they" are serious, we could get there pretty quickly.
My personal plan, should I decide to accept this assignment Mr. Phelps, will be to control my risk, by trading spread trades, probably by buying September calls, and day trading near term short calls against the position. I have another way of doing it, but I'm not sure I want to go that route, as it requires a big move up over the next four months, but that would be to buy deep in the money puts, like in September, to cover a standard stock position in the Q's, the current take would be the September 39 strike puts, which you have to pay about .94 cents for (the total cost is 6 bucks for them). The only way to make money doing this, is that we go higher quickly, which would give you a delta dump on the puts, like, say we got to 39 by next month some time, then those 39 puts would be selling for upwards of 2 bucks, as the delta would have gone from the high 60's to probably around 50%, so you would pick up like $1.00+ on the trade. Your total risk is protected by the puts, as you would never lose more than the .94 cents. Naturally, of course, you pay for those put's by, again, day trading sold calls against the stock position.
Anyway, it's just some idea's I'm looking at, have fun out there today.

MSW 4/29/09

I'm only showing the Russell 3000, there were no changes on the ETF screen from yesterday. The focus list is the buys and shorts it came up with on the daily chart screen, it came up with 15 new buys, and 21 new shorts. I went through each one of them, and found exactly, aaaahhhh, NONE, that I find interesting, go through all of them your selves, the shorts not shown are SMOD, DIN, HILT, LLNW, LORL, CLDA. I have a weekly chart of INTC on there, because I'm always interested in Inkey, it issued a new short on the weekly chart, now, my strategy is to buy this thing if it pulls back, so I'm only interested in the short, meaning it "might" pull back.



Barry Rosen has a new forcast out, enjoy:

JUNE S&P e-MINI HOURLY CHART TREND: Topping toward 871 or 882.50

DAILY CHART TREND: Topping ad lower into May 8.

WEEKLY CHART TREND: Higher into the fall toward 1060.

OVERALL: The S & P almost retested last Friday's high after early losses on the week. We are inclined to expect a lot of congestion over the next few weeks with the FOMC announcement on Wednesday, the employment report on May 8 and the bank audit results on May 4 or later. The FED has already said they would come to the rescue of the banks that are not up to par. Wall Street leaks of bail out again for BOA and CITIBANK is not good news. We think the Swine Flu scare will fizzle because it is really not that virulent but it may be 2-3 weeks before the public gets the sense that people are not dying from it unless they have weak systems. At the moment, the market could start a deeper correction from 882 to 750 or lower into May 8 but the market is going to have to take out 819 to turn bearish and that could happen. After a correction into May 8, one the upside we are looking at 905.75 and 943 and the major cycle is still positive into May 29.

SWINE FLU ECONOMIC NOTES: The World Health Organization said a full-borne pandemic could decrease GDP by 4.8% worldwide due to loss of productivity and travel. We had been more concerned about after Sept. 2009 and specifically between Jan-March 2010. Either the current outbreak will not escalate and affect the U.S. as badly as other countries or we will see something else along these lines into the early part of next year. Probably it will not turn out as virulent as expected as the Mexican deaths may be a fluke do to poor care and weak immune systems.

LATE APRIL/EARLY MAY: The trade may enter a bit of congestion before the April 29 FED announcement. The market is often lower into the end of the month and then short-covering for 401k money and window dressing may happen. At best we see congestion between 820-882 and at worse with a move to 750 having about a 10% chance into May 8. The cycle between April 23-May 8 has about a 95% correlation with at least congestive but more often lower moves. We still think new highs to 903 or better will happen into the end of May.

NEAR TERM: (4/28) The possibility for higher prices is still there into the FOMC meeting but we think 882.50 is the worse upside before another break. The market really needs to take out 819 (ie 823 plus slippage) to create a stir and given some of the current cycles and the bad cycle for banks and the generally bad economic cycle into May 8, surprise bad news is more likely than anything. Since the major cycle is strong into May 29, if the market congests above 790-800 into May 8 or even goes lower, then it could take off to 905.75 or 943 into early June thereafter. Higher prices are possible as very bullish cycle into May 28-30 for crude could lift stocks even more if that connection happens. There are still chances for 882 if they somehow celebrate the FED meeting announcement. Not sure what more they can do after throwing everything and the kitchen sink at the market last time.

CYCLE NOTES: (4/21) We did new research at the conference and think that the first few weeks of June is topping and that lower action could happen until August 7 and then a slight new high into September or max. early October and then major downward action into November. The market may be sideways the spring of 2010 and then do a final leap into early May for a new high and then be sharply lower into Dec. 2010.

MULTI-YEAR CYCLES: (4/21) 2009-2017: We did new research at the conference and think that the first few weeks of June is topping and that lower action could happen until August 7 and then a slight new high into September or max. early October and then major downward action into November. The market may be sideways the spring of 2010 and then do a final leap into early May for a new high and then be sharply lower into Dec. 2010. For 2010: Cycle highs peak into May 2010 and then fall sharply into late Nov. 2010. They recover into August 2011 and fall off into Dec. 2011. The year 2011 seems sideways to lower but could end up dropping much more significantly if we are correct about the dollar falling sharply. The biggest crash appears to happen until Dec. 2012-July 2013, and that coincides with the 1993 banking crisis in the 120-year cycle. We see a recovery into August 2015 and then new lows to 2016 and April 2017 before the bear market is over. Folks who were trading from 1966-82 can remember that you can have 18-20 years of congestion at times. The mess we are in will go deeper than the 30's depression by the time we get to 2013-16. The good news is that a new economic system will come out of all of this.
JUNE NASDAQ e-MINI FUTURESNEAR TERM: (4/29) NASDAQ futures made a slight new high again and is closer to 1388 while the S & P continues to fail and that is a typical topping divergence scenario. We would not attempt to top-pick while the S & P failed and that was an important divergence. Resistance on NASDAQ is at 1388 and when it finally breaks out after congestion, we are likely to see 1443 into later in May.

CHICAGO JUNE MINI-GOLD (electronic)HOURLY CHART TREND: Topping and lower. DAILY CHART TREND: Lower into May 8.

WEEKLY CHART TREND: Fourth-wave retracement to min. 820 into July cycle low. MONTHLY CHART TREND: Lower into Feb. 2011 and then higher to 2400-3000 into 2012-13.

CYCLES OVERVIEW: Generally lower into May 8.

NEAR TERM: (4/29) Gold is still in a tricky position. One would think that the break in silver will bleed into gold. We still are thinking that gold has a chance to reach up to 922-24 and we are still remembering that gold went up in the spring of 2002 with the SARS scare. Still, linear cycles and geocosmic cycles are lower into May 8 so we should focus on a fall to 850 quickly and then 819 and 778 soon.

OVERALL: Extended upside is toward 935.50 and 949.90 should we see a breakout above 925. We are more inclined to expect 850 and 819 first.

BIG PICTURE: (4/24) At the moment we are inclined to think that gold will make a cycle low into May 8 and then be higher from there. Some gold cycles then suggest a high into the week of June 8-12 but we will need to take one step at time. At some point we may see 820 or 800 or 796 but that could even take until early August.

MONTHLY CHART TREND: (2/24) We think the dollar will become worthless into 2012-3 and that gold will become king again. Prices project 2400-3000. This is not the time to do an entry on such a trade, as the weekly chart is topping for now, but it will continue to be a long-term investment and seasonally you want to buy in July or mid-August.

JUNE e-mini CRUDE (electronic)

DAILY CHART TREND: Lower toward 4146 into May 8.

WEEKLY CHART TREND: Higher into May 27-30.

FUNDAMENTAL OUTLOOK: (4/22) Recent DOE reports remind us that crude belongs closer to $40 or in the high 30's and that with a 5-6 million barrel surplus per day and stocks are 16-year record highs, even a Middle East war is not going to have the impact that it would have had a year ago.

OVERALL: We do think that crude will take off from early May into the end of the month but until then it could even congest between 42.00 and 56.00.

LONGER-TERM ENERGY CYCLES: (4/13) Some cycles for the whole complex are even suggesting higher prices into the last week of May and we are sure of that now and expect there is no time left for shorts. We are even postulating a May 2010 high and a Dec. 2010.

BIG PICTURE: (4/21) Crude is likely to hit 70-75 dollars July and then looks lower into August and higher into October. The cycle that caused the June 2008 high is repeating into Oct. 9, 2010. I do not think traditional economic woes will cause that to happen.

4/29/09

2:30pm: With the close of the trade today, this is an updated equity curve for the McClellan strategy. Being the skeptic I am, I find it hard to believe it can keep up this torrid pace, as it's had 9 winners in a row, and 13 of the last 14 trades have been winners, I have to believe it's due for a draw down, therefore, in that spirit, I will post the easy language in the comments section for the strategy. Do with it what you want.

2:10pm: FOMC days, ya gotta love'em. I had a couple of scalp's today, the first was the circle on the 5 min chart at the bottom, I was watching this nice channel like pull back that lasted over an hour and twenty minutes. I was actually yakking with Sysin and someone else about our college days, but keeping an eye on that channel, as I had an "area" I thought I would get interested in, there was a light blue trend line that went from four bars before the close yesterday, and the open today, and the black horizontal line was the high from yesterday, and I was looking to get long if we happened to set some thing up right where they crossed. It's kind of funny, because someone told us to stop yakking about school and get back to work, just about when we set up that cool little doji bar inside the circle, which was also an inside bar. The previous bar had just tested the saddle at the black and blue lines, so I went for it right on the open of the next bar at 34.10, initial stop under 34. I got lucky and got in the green right away, but the third bar at the arrow turned red, with a TICK dump, so I took a "FEE" stop by taking half off for a four cent profit, which picked me up two extra cents, so I raised my stop to break even, or 33.09. I got lucky, my initial target had been 1 cent under the 200dma at .24, so we ran up three bars, ABOVE my initial target, then we got a red zinger at the arrow and I took the second half at my original .23 target, 15 cents, not to bad for me.

The reaction after the FOMC announcement is one of the most consistent patterns in trading, you get an initial move in one direction or the other, then a counter move wave 2, that can be equal to or greater than the first move, and then wave three goes back in the direction of the original move. The first move was down, at the arrow by the "1", it was a whippy first bar (typical), and was only two bars, as we stopped at yesterday's highs (the thick black horizontal line), AGAIN, and then blasted off in wave 2, which went to new highs within two bars. The arrow next to the 2 was my "take", but the prior bar was the setup, as it made a new high, and then turned red, a classic BOF, a break out failure bar, IE, it makes a new high for the period, and then fails to follow through. My take it bar actually gapped down, and then turned around and went up to test the high on the BOF bar, before turning back down, I took it short right at the open, with a stop above the HOD. I again took half off on that arrow off the "3", on that green bar, and hung on with the second half, as I had my earlier profits and some off this trade, I was "hoping" to see us test the line at yesterday's high's again, and I got lucky, so I took the second half at that point.

The McClellan finally exited that long trade, that goes back to 4/15, it exited at 10:30am at 34.13, for a $1.80 gain. The next trade on the McClellan will be a short when it cross's back down under the +100 level.

The daily chart is "ALMOST", a classic BOF, break out failure day, as we took out the prior highs, AND, the 200dma, and then failed to hold the break out level's, and close under them for the day. A better BOF would be if the bar had closed red, or taken out like the low of the previous day. It doesn't mean it's the end of the rally, but I would hate to see us take off south off this bar tomorrow.

All in all, a pretty good day for me, that one day a week, that makes your week. Hell, I even managed to get out of a few of those "gambler's" I took yesterday.

MSW 4/28/09

There was no change on the daily ETF's, so I moved to the weekly, it has SEA, VYM and XLB, as new shorts. I have the chart of TLT up instead, in the upper right corner, it's a confirmed sell on the weekly charts. The XLB looks interesting, materials, I play this using UYM. I put DGP up because it seems to love gold on a weekly basis, HOWEVER, it has it as a confirmed short on the daily chart, so, pick'em. The Q's are still on a buy on both the daily and weekly charts (although some one, I can't imagine whom, would debate that).

The daily on the Russell 3000 has 11 new buys and 17 new shorts, much closer to a number of new trades you would expect. I picked out two, go through the other charts yourself, PKOH looks interesting as a long, as it's pulled back to that trend line, and the stop is VERY clear, I wouldn't want it under like 3.80. DRI is my short, a break under 38 and it probably see's 36 quick, and then maybe back to the 33-34 "area". I guess they've been running the casual dining restaurants up because people just got money out the ying yang to spend on crap.

I'll probably be concentrating on adding a few shorts to my "portfolio" tomorrow, to counter act my over whelming bullshitishness.

4/28/09

215pm: I continue to have some "puter" problems, I shut down twice today, but I hope to have it solved by this evening, and post an OT update.

With the problems I haven't been doing diddly squat during the day, naturally, as I don't want to get trapped in a day trade, that turns into a position trade, hahahahaha, sigh! I did take some little leap option trades today, actualy, kind of modified leaps, on some stuff that was bought up in the Mrkt. Rewind chat room, and some other things I saw, but the positions are so small, they are less than what a stop would be on a normal trade. I used an extremely complex strategy to pick my positions, it's called gambling, hahahahahaha!! I took 5 of them, I can't even remember what they are, although some are KMX, SD, CSCO, PFE, and another one, I don't remember, ERTS, that's what it is. Luckily, every one of them were red at the close, I say luckily, because the only reason I do this, is to teach myself the continuing lesson of not to gamble, sigh, I need to do this once in a while just to remind myself not to do this once in a while.

The Q's close with a little doji hammer type candle on that daily, I included the daily of the DIA and SPY, as I consider the last three day pattern preeeetty ugly, as we've gapped down the last two days, and then I get the feeling that "some body" is trying to hold us up through the end of the month, as we rally off the gap down, and leave a green body on the candle. Kind of makes me glad I'm having problems, I wouldn't want to try and trade this junk.

The 60min McClellan is just a mess, it STILL didn't take out the long trade triggered on 4/15, I find it pretty strange that it went straight down after the open yesterday, during the initial rally, and that it went up today the last six hours, while the Q's were basically going down, this market even has it confused, hahahahahaha!! Anyway, the thing is in REAL trouble, as it has to get above the +100 level to exit the long trade, as it won't go short until it exits that trade, so if the market should decide to go DOWN from here, it would get a huge draw down. If it got under the -100 level, and then went back up and triggered the long signal by crossing back over the -100 level, I would probably consider that for another long trade.

4/27/09

7:45pm: This is my awe inspiring comments for today, BLEAH!!!!! I'm going to have to change my life style, or some thing, things are NOT going good right now. I fired up my main computer last night, and it finally coughed the big one up, it's been trying to do it for a couple of months now, OBVIOUSLY, so the real killer happens, I take it down, and install the back up computer, hhahahahahahahahahahahahahahaha, SAME STINKING THING!!! Did I say, THING'S ARE NOT GOING GOOD RIGHT NOW???!!!!! Anyway, it's 115 miles to take it down and get it fixed, and I sure as hell wasn't going to take the trip again to pick it up, so I waited on it, and just got back home, THANK GOD!! It had burned one of the video cards up.

I have no idea what the market did today, but looking at the two charts above, the SPY has one uggillly looking setup on it the last three days. It looks like the Q's tested the November high, that was 34.01, you can just barely see the declining 200ma peeking down, just above the candle today. It would have been better for a short if the thing would have set up a candle like the SPY did today, maybe tomorrow we go through the 200ma, THEN, set up a candle like the SPY did today, anyway, I shall see.