I found some nice stocks that you might wanna look at, no promises that it is going to repeat its behavior tomorrow.
So all you need to do is stay awake and perform.
Tuesday, November 11, 2008
FSLR, NKE, BIDU, RIG (12 Nov 2008)
Today was a fantastic day to daytrade, the market tends to wear you down with a few days of low volatility to make you feel frustrated and sleepy
I found some nice stocks that you might wanna look at, no promises that it is going to repeat its behavior tomorrow.
So all you need to do is stay awake and perform.
I found some nice stocks that you might wanna look at, no promises that it is going to repeat its behavior tomorrow.
So all you need to do is stay awake and perform.
Lack of market direction (11 Nov 2008)
Major currencies and commodities are showing mixed signals, currently there is no solid trend ... so I expect non other than a continuation of sideways trading in tight ranges.
Crude oil prices is holding up well thus far, despite a serious recession in the EURO zone. My barometer for commodity stocks is XOM, as long as this stays static...I am not expecting DIG or DUG to move very much.
I have identified a possible pattern to use as a guide for your trades. The chart below shows that SPY is quite well supported by the "Buy Line". You can use this trend line as support , but kindly note that this "Buy Line" has an expiry date which is on 17 Nov 2008. Use the "Sell Line" as a guide in the event of any bear market rally.
In the event that the "Buy Line" is breached, this will become invalid...then the best course of action is to wait for the bottom and buy your favourites.
Crude oil prices is holding up well thus far, despite a serious recession in the EURO zone. My barometer for commodity stocks is XOM, as long as this stays static...I am not expecting DIG or DUG to move very much.
I have identified a possible pattern to use as a guide for your trades. The chart below shows that SPY is quite well supported by the "Buy Line". You can use this trend line as support , but kindly note that this "Buy Line" has an expiry date which is on 17 Nov 2008. Use the "Sell Line" as a guide in the event of any bear market rally.
In the event that the "Buy Line" is breached, this will become invalid...then the best course of action is to wait for the bottom and buy your favourites.
Friday, November 7, 2008
Trading Range (07 Nov 2008)
I am seeing some calm in the EURO at the moment, I think we could be seeing some sideways trading in the EURO until the market finds its direction again.
At the moment I am neutral on commodities.
One observation after the rate cuts by the ECB and BoE is....the GBP and EURO has not been declining as aggressively as expected. This is due to the recent bad economic news in the US in regards to the increasing losses in jobs and slowdown in the manufacturing sector.
At the moment the SPY is still not oversold at all, downside risk still remain. On the contrary, stochastics reading is also pointing to a possible resumption of the uptrend (note the divergence).
So I am anticipating a possible sideways trading or another huge move to the downside or upside.
I think at this point in time, oil stocks are a weak short. I experienced strong resistance while holding DUG at the 41 level, so I got out of my DUG positions. As of this morning, Crude Oil has rebounded by 0.89 due to traders covering their short positions.
USO has found some strong support at about 50, the stochastic indicator shows possible tight trading range moving forward.
Strategy:
Wait for a retracement to 98 then decide to go short. Buy small if it hits 84 or lower.
Stockpicks for long or short:
Long: TNA
Short: TZA
More updates later
At the moment I am neutral on commodities.
One observation after the rate cuts by the ECB and BoE is....the GBP and EURO has not been declining as aggressively as expected. This is due to the recent bad economic news in the US in regards to the increasing losses in jobs and slowdown in the manufacturing sector.
At the moment the SPY is still not oversold at all, downside risk still remain. On the contrary, stochastics reading is also pointing to a possible resumption of the uptrend (note the divergence).
So I am anticipating a possible sideways trading or another huge move to the downside or upside.
I think at this point in time, oil stocks are a weak short. I experienced strong resistance while holding DUG at the 41 level, so I got out of my DUG positions. As of this morning, Crude Oil has rebounded by 0.89 due to traders covering their short positions.
USO has found some strong support at about 50, the stochastic indicator shows possible tight trading range moving forward.
Strategy:
Wait for a retracement to 98 then decide to go short. Buy small if it hits 84 or lower.
Stockpicks for long or short:
Long: TNA
Short: TZA
More updates later
Wednesday, November 5, 2008
Fundamentals back in play (05 Nov 2008)
Markets are positioning for the coming rate cut decisions by the ECB on Thursday.
This morning, I am keeping an eye on the EIA report. I believe this is key to understand where commodities are heading after the ECB rate cuts.
Despite having an opportunity to purchase more DUG at 3 dollars discount, I stick to my guns to avoid adding more DUGs because I think there is potential for commodities to come alive again after the ECB rate cuts. We will see if Crude Oil prices deteriorate further to hit the lows in the coming weeks.
The strength of the US Dollar will also be put to the test in the coming weeks to validate that fund repatriation activities from overseas are over.
Historically many trend changes happen in October, it is important to see where this market is heading by looking at the fundamentals again. So I am merely taking this elections as just a short term event.
Lets examine the chart of USO.
I think we could be testing 47 soon, ECB rate cuts and other economic numbers from Europe, US and other countries are key here. I see global deflation as a key reason for deterioration of Crude Oil prices and a lot of these has to do with job numbers.
To the extremes, Crude Oil could see further declines to 30 or 40. I expect this decline to accelerate to these levels at one point in time. I think OPEC countries are going to compete among themselves to grab every tiny piece of business available due to slowing demand by lowering prices further. So who sells the cheapest will get the business...
Defending prices by cutting production at this point is in my opinion....not a very wise move...especially when the main goal is to heal the world economy to improve demand for oil.
Sooner or later, consumers are going to find a way to cut their demand for oil.
This morning, I am keeping an eye on the EIA report. I believe this is key to understand where commodities are heading after the ECB rate cuts.
Despite having an opportunity to purchase more DUG at 3 dollars discount, I stick to my guns to avoid adding more DUGs because I think there is potential for commodities to come alive again after the ECB rate cuts. We will see if Crude Oil prices deteriorate further to hit the lows in the coming weeks.
The strength of the US Dollar will also be put to the test in the coming weeks to validate that fund repatriation activities from overseas are over.
Historically many trend changes happen in October, it is important to see where this market is heading by looking at the fundamentals again. So I am merely taking this elections as just a short term event.
Lets examine the chart of USO.
I think we could be testing 47 soon, ECB rate cuts and other economic numbers from Europe, US and other countries are key here. I see global deflation as a key reason for deterioration of Crude Oil prices and a lot of these has to do with job numbers.
To the extremes, Crude Oil could see further declines to 30 or 40. I expect this decline to accelerate to these levels at one point in time. I think OPEC countries are going to compete among themselves to grab every tiny piece of business available due to slowing demand by lowering prices further. So who sells the cheapest will get the business...
Defending prices by cutting production at this point is in my opinion....not a very wise move...especially when the main goal is to heal the world economy to improve demand for oil.
Sooner or later, consumers are going to find a way to cut their demand for oil.
Tuesday, November 4, 2008
Possible outlook and updates (04 Nov 2008)
The market remains in a wait and see mode, but MMs are making plenty of money at this moment....while buyers or sellers are positioned for a bull run or a plunge....
Commodities are suppose to fall hard if not for the elections. I think Thursday will be a key day for commodities, if ECB cut rates....I think this might have a negative impact on commodities. But if EURO rebounds on the same day, we could possibly see commodities hang around for a little longer.
The EURO could be due for some correction later in the day or tomorrow during European trading hours.
As for the SPY, it is still trading below the "Chop Zone". Usually, I would favor a slight pull back before any attempts to breach past the two layers of resistance highlighted in red to get past the "Chop Zone". But it is possible that the historical buyers might want to delay any selling until after the elections for a better price.
I think SPY could possibly pullback a little if we base on the VIX. I see VIX falling to about 51 (red trendline).
Unless, we have no pullbacks and have a really powerful rally, then we might see VIX fall towards 35. I seriously have some doubts that this can be achieved overnight.
Perhaps we can learn a little about the market this week...lol.
Strategy:
1. Buy some inverse ETF when VIX reaches 51, go small first. I still own some DUG and am continuing to observe the EURO
Commodities are suppose to fall hard if not for the elections. I think Thursday will be a key day for commodities, if ECB cut rates....I think this might have a negative impact on commodities. But if EURO rebounds on the same day, we could possibly see commodities hang around for a little longer.
The EURO could be due for some correction later in the day or tomorrow during European trading hours.
As for the SPY, it is still trading below the "Chop Zone". Usually, I would favor a slight pull back before any attempts to breach past the two layers of resistance highlighted in red to get past the "Chop Zone". But it is possible that the historical buyers might want to delay any selling until after the elections for a better price.
I think SPY could possibly pullback a little if we base on the VIX. I see VIX falling to about 51 (red trendline).
Unless, we have no pullbacks and have a really powerful rally, then we might see VIX fall towards 35. I seriously have some doubts that this can be achieved overnight.
Perhaps we can learn a little about the market this week...lol.
Strategy:1. Buy some inverse ETF when VIX reaches 51, go small first. I still own some DUG and am continuing to observe the EURO
Monday, November 3, 2008
Bulls and Bears are losers today (04 Nov 2008)
In case you guys have not learned your lessons, just wanna share with you. Don't try and be a bull or a bear in the options market today. The VIX is in the midst of correcting itself.
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