5/7/09

6:00pm: The MSW came up with no change on the ETF scan, surprisingly, I thought it'd be flashing sell all over the place, but it seem's to want to give this little pull back a chance to work it's magic. Which, it turn's out it's right, as the futures are up after the release of the much anticipated stress test's. That may change by tomorrow, or, after the payroll report, we might be up higher.
It came up with 7 new buys and 58 new shorts on the Russell 3000, I have BUCY on the chart, as it's kind of typical, a gap higher followed by a bearish engulfing candle. The two longs not shown are ZION and SBX, the shorts not shown are IART, AIN, GFF, LWSN, JRCC, MDR, VCLK, NYM, ICE, ENG, EOG, BABY, MW, HYC, SM, TRLG, ACO, APA, PCH, LSTR, COF, DRIV, PSUN, DAL, NRCI, MDRX, EMR, PRX, BOH, STI, USU, AWP, and COP.

At least two trader's I know, have decided to call it a summer, and relax until after labor day. This is about the time of year that I leave for my search for the truth, but I have mucho research and work to do, so I'll be hanging around, although the idea sounds verwy verwy nice.

2:10pm: Quite the awe inspiring day, we opened with another love fest, gapping up on the great new's of piss poor earnings, BAC rallying 20% on new's it has to dilute it's share holder's to the tune of 34 billion dollar's, missed retail sales data, job loss's in the 450K range, energy up, interest rates up, you know, all the shitty new's that we've been rallying on, and then just like yesterday, they sold us hard right out of the chute for the first hour, only this time quite a bit harder. We went sideway's for three hours, and then had a little continuation into the final low's of the day, with a little rally attempt the last half hour.

We probably rallied on the stress test release's coming out after the close, when we might find out BAC has to come up with 100 billion, rather than a measyly 34 bil, hell, they'll probably rally 40 fricking percent on new's like that. We also get the monthly payroll data in the morning, so if it come's in less than 650K, we probably rally on that as well.

The 60min managed to hold that lower thrend line, breaking under it and then closing over it. The good new's is we filled two gap's, so that's taken care of, the next unfilled gap is sitting at 33.48, from 4/28. We have a pretty clear "bow tie" in the MA's, right at the 50ma.

The daily put on the widest bar of the rally, and also the largest volume, I believe. Both the CCI and RSI5 broke down into sell signal's, the STOCH did a sell cross over, but it would probably have to break under 80 to have a true sell signal. Just as the Q's were warning, by under performing the last few days, they did their job and made up for it today, by outperforming on the down side, losing more than the DIA, SPY, and IWM.

It's hard to say if the drop out of the open yesterday was a wave one drop or not, if you take the length of the drop yesterday, and start from the close, we had just slightly more than an equal move today. However, if today is just the first true wave, then we could have a much deeper wave two equal move coming up, after a slight rally to set a lower high.

Just as I had feared, the McClellan is working on another draw down, the bounce off of almost exactly on the -100 level was probably the hint, that some thing was amiss. Anyway, I never could take a hint, and since we got a little cooked on it, at -159, I took another unit long.

MSW 5/6/09

6:00pm: The MSW had one change on the ETF's today, it want's to buy the gold miner's, GDX. I find it interesting that it has a sell on the dollar, UUP, and a buy on gold, DGP, at least it's thinking right in it's allocation mode. If you look waaaaay down at the bottom, it's currently on a sell on UYM, which surprise's the hell out of me, as hot as that sector has been.

The Russell 3000 has 13 new buys and 30 new shorts, new shorts not shown are CBK, REXX, IFLO, SRDX, RACK, XTXI, ABFS, PHIIK, MCGC, LHCG, GT, and PCLN as shown on the chart. I agree that it's a pretty looking short setup, but the idea that people are going to be traveling like crazy, it just beyond ludicrious, IMHO. Another one of my most favorite UNFAVORITES, is listed as a short, GRMN, I mean, even an idiot like me can figure out the future for that thing, with the US auto industry falling apart before our eye's. I also found it interesting that it's decided a couple of the oil industry player's are shorts, TSO and JOYG.

I found this thing on my Telechart's 3 day pull back scan, YAVY. What a "cute" chart, I mean, beside's the 3 day pull back it's done, it has a rounded bottom (uuuuuhhhhhmmmmmmm, rooooouuuunded bottoms), and is trying to possibly setup a cup and handle formation. Cool stuff, if it goes back up to challenge the cup level around 8.50, I might get interested.

5/6/09 (Buy the close, sell the open)

2:10pm: Here's the daily chart of the Q's, hahahahahahahahahahahahahahahahahaha!!!! Ok, actually, the reason it's so convoluted looking, is because I have a strategy on there showing the buy's and sell's of a strategy I've been working on for months. After extensive research and developement, I finally came up with the coding for it, in fact, here it is now:

Buy this bar on close;

Sell next bar on open;

The equity curves are below this next chart.

The Q's are in a very clear channel here, hell, it's so damn obvious, even I see it, hahaha! I guess it can just keep walking the top side of it forever, if it ever drop's to the bottom of it again, I suppose it would be a buy. Q's are up about 20 cents after CSCO reported.

The testing result's were based on buying 1000 share's of the underlying, so naturally, some of the ETF's took more capital than other's to put the strategy in action. In case you were wondering what the little dip's in the curve are, those are called bear market's, for some unbelievable reason the Strat tend's to want to draw down during bear market's, hahahahahahaha, no shit gomer! I was actually kind of surprised to see the Q's outperform the other one's, although the curve on the IWM has been the most consistant, the DIA performed the worst, the DIA is at the top, then the Q's, SPY, and then IWM at the bottom. But, the Q's outperformed on both the draw downs, and total amount made since 1999.

Anyway, it's some thing I'm seriously looking at, I'll be doing it with options of course.

The 60min McClellan exited the short trade from thursday, 4/30, at a loss of 50 cents this morning. It then reversed and went long on the next bar at 10:30am, at 34.96. That was it's first loss in the last 10 trades, it dosen't mean any thing, but on a personal basis it always make's me wonder if the system is starting to go into a draw down mode. I'll probably give it like three more trade's, to see if it keep's working. If not, then I'll start tweeking it with new parameter's.

MSW 5/5/09

There was no change in the ETF's from yesterday. On the Russell 3000 it came up with 13 new buys, and 31 new shorts, the new shorts not shown are SMBL, ASBC, TRMK, AMAT, TIE, AZZ, DNN, WFC, SFLY, CONN, JCG, OMX, ABCO. As you can see, or, I, can see, it came up with new shorts on some mega stocks, like IBM, AMAT, SOHU, WFC, I don't know what that mean's, but it tell's me how I will be leaning. I have no idea why I have TBSI up there.
Just as a confimation on the software, it put either confirmed buys or short's on all the stocks listed yesterday, IE, it did NOT reverse any of the signals.

I REALLY like that short setup on IBM, it just missed being an inside day by 7 cents, I'd like to see it open flat, maybe even test yesterday's high, and then cough it up and turn down. Regardless, my take will be under the low of today, with a stop over today's highs, some where.
On the weekly chart, I have to say, the MSW is on a confirmed buy on it, and it look's like it has clear air back up to about 116, so I would be on a quick short on this thing, unless it broke under 100.

The Q's put a "hanging man" candle on the daily chart, nuff said, I'm tired of talking about them.

MSW 5/4/09

6:15pm: The MSW came up with 18 new buys and 23 "possible" new shorts, the shorts not shown are CDNS, AVCT, CLDX, BKCC, PKI, SFSF, IPI, LXRX, SPTN, NVAX and CBEY, this is the regular default scan. I only have SWKS on there, because it's a perfect example of my favorite pattern, the three day pull back, above the 50dma. The stock was in a strong uptrend, went side ways for a few days, and then had a quick 3 day pull back, that almost touched the 50dma, the "take it" was over the high of that third bar, the whole setup was in the circle, I didn't catch it. There's a couple that are interesting on there, it put a new buy on DRI, after that sucessful short, DRI actually had a pull back of 5 bars, still within the parameter's.
SJM had a real "JAM" job today, closing over the resistance at 40, and "could" be headed back to 44.


I ran the ETF's through the swing trade profile, and it came up with 7 new buys. Having FAS and UYG on there is kind of Deja Vu all over again, but I found it interesting that's the software is consistant. I'm in FAS of course, so that probably had some thing to do with showing it, anyway, if it can get over this little shelf to the left, it goes right to 11, at that point, I have no stinking idea where it goes. I thought that was an interesting move by the shipper's today, SEA, on a weekly chart they have some resistance at about 13, but above that, and there's not a hell of a lot between here, and 22.

5/4/09

2:15pm: HAH! The bank's must have found the cure for financial cancer today, that little position I have in FAS was up 25% today, the stupid thing went vertical the last 1 1/2 hrs, I also have a little RF that I picked up off the MSW, I sold half of that today.

My Q's 60min McClellan is in another one of it's "draw down" stages, as it went short last thursday, if it can get back up above the +100, and then drop below that level, I "may" add another unit short, on a second trigger, just like I did when it had the last draw down, when it was in a long trade. I see no resistance for the Q's up to that 38.2% retracement level at 36.58, pretty much clear air, it does have a gap fill from 10/3 sitting just under that level, at 36.18. Suprisingly, at least to me, the Q's actually under performed today, up "just" 2.04%, compared to 2.61% for the INDU, 3.23% for the SPY, and 3.46% for the IWM, "investor's" may be rotating into other sector's, that have not had the run that the Q's have had.

I had a cool little chart I was going to put up, but it was from another site, but it showed the average gain's or loss's for each trading day of May, and the second trading day of the month has averaged the largest gain of the month, the second trading day of the month of course, was today. Anyway, the performance drop's off the next four days, tomorrow is usually positive, with the three day's following that having a pretty negative baisis.

MSW Weekly Update

7:00pm: I created a new scan for the Russell 3000, with the "Swing" and "7 Day Move" profiles, and ran the scan through tonight, since this is Sunday, with the "swing" week ahead. I plan on holding this scan for the rest of the week, and then see how it did on next Saturday, just to run a little test on the MSW, I may do this for a few weeks. Besides the longs listed on the focus list above, it signaled longs on GFIG, KWR, FISV, TE, ETR, RSYS, AMCC, GTN, MIG, MORN, BW, BABY, VVUS, CL, ASYT, PMI, AHR, PKI, ALSK, and NVAX.
Short signals for the week are BZH, IO, ALC, CPBY, EVR, CBEY, BJS, RRI, FVE, RBN, WPO, IR, CNX, VVI, NDN, G, TSCM, SBUX, UCTT, SBSI, DF, PKE, NFP, NOVN, IBM, KR, CCBG, HOT, EMR, AOC, IMMU, DTSI, ABBC, CDI, PRK, CHSI, SUSS, CWT, AROW, SRV, FIX, CLI, NL, AES, TBL, TRGT, CTO, AVB, and the END.

6:50am: The MSW weekly scan has 16 new buys, and 34 new shorts, over a 2 to 1 margin on the short side. The two chart's show long signals in WHR and TECH, I'm throwing a bone to the long oriented "investor's" out there, just to be nice, as personaly I'm not inclined to be long here, as evidenced in the chart below. Anyway, I ran through each of the daily chart's on the long signals, to confirm the weekly signal against the daily signals, and TECH is kind of interesting. It closed above that 5 week consolidation it has, just to the left, and has a shot at clear air up to about the 64 "area", but what I really like, is on the daily chart it has done a three day pull back, and set up a nice green bottoming tail doji like candle on it. WHR is fascinating, I guess it had good earnings, but it rallied right up to the January highs, and stopped, this after doing a gap fill, to make sure it picked up what ever big boy "investors" that got left behind (I'm sure the MM's had nothing to do with that, hahahha). If it can get over that high, it has left clear air all the way back up to the 88 "area", should da Boyz decide to grind it higher, but that candle is very indecisive, as it has long tails on both sides. Personally, I see no hope for housing, as we still have the greatest number of mortgage reset's coming up in the next two to three years, and I can't see how house wives would be able to afford to buy new washing machine's, most of them will probably be investing in "ROCK", as in, they will be doing the wash by beating it on a rock, down by the stream. But hey, that's just me.
The shorts all look fairly decent, the additional short signals not shown on the focus list are HTZ, LBTYA, AM, ISIL, PKE, FFIN, HSII, EXLS, ENR, EGP, LTM, ACF, SHW, CRAY, NL, DNDN, DFG, YHOO, WPS, and UFPI.

Wow, I don't know what happened friday, but the MSW just absolutely hated it (or loved it, depending on your outlook). On the daily scan it came up with 5 new buys, none of which I like, and 48 new shorts. The great majority of the short charts look very nice, I have SCSC up there because it is typical of what most of the charts look like. It had a hammer type candle on thursday, with a long topping tail, followed by a narrow range doji, INSIDE BAR, just a classic short setup.

The additional short signal's not shown on that focus list are MENT, LXU, DNN, EXTR, SPTN, PTEC, PMCS, EQIX, NILE, GB, DAKT, LSI, TBL, DTSI, ABG, BHS (Beaver High School, wooo hooo), ICTG, and PSS.

I'm showing the weekly scan of the ETF 7 day move and Swing profiles, it did some thing this week that confirms to me that the software seems to be working half way decent. First off, in the "Sig" column, starting with IWF, there is 12 signals with a green square in the signal column, this means that the software stopped out on those signals. When I clicked on each one of those charts, each one of those stop outs were from a long signal, generated seven weeks ago, from the "7 day Moves" profile, meaning the software hit the almost exact bottom of this rally, on the weekly charts. It automactically stop's out after 7 bar's on this trade signal. It has generated a new "7 Day Moves" long signal for SSO, after stopping out on the original long signal, last week. It liked the move in commodities this week, as it generated a new long signal for DBA, and it continues to hate financials, as it generated a new short on FAS, and it continues to like the SMH.

The part I really like, that confirms to me the MSW is working, is the signals on TLT and TBT. It has a new confirmed guy on TBT, and a new confirmed short on TLT, both on the "7 Day Moves Profile", which is exactly correct, as they are inversely correlated. I'm not saying the "signal" is correct, IE, you should be buying TLT rather than shorting it, I'm just saying that I'm pleased to see that that it is correctly giving an inverse signal on them.

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.