A Baby Bull All Growns Up

I added into strength just now, putting on more JO inside 12631 with several points of cushion on my original entry.

I am playing for a secondary rally in coffee after a riveting first quarter of 2014. Put another way, if coffee is in a new bull market then we should assuredly see another leg higher from here, lest the rally earlier this year be seen as an aberration.

On the 30-minute chart of the coffee ETN, below, note the base breakout higher this morning.

Indeed, coffee seems to be acting as well as any commodity this morning, with many of them soft.

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I scaled off a piece of my WYNN short, a trade discussed frequently on this blog last week, inside the 12631 Trading Service this morning.

Major casinos are threatening serious, multi-year breakdowns, most notably LVS MGM MPEL.

Into the morning gap lower, I took a piece of my position off the table for the sake of discipline. I still have a meaty position on, though.

On the zoomed-out daily chart, below, note the well-defined support breakdown after probing that level for all of 2014.

Here was my note to members:

Covered 1/4 of full position SHORT $WYNN @ $187.43 from core $197.93 entry and $193.21 add to scale gains. Raised cover stop to core entry. 3/4 position now.

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The following is just a small excerpt from my latest Weekly Strategy Session (please click on that hyperlink for details about trying it out). which I published for members and 12631 subscribers this past Sunday.

Even though prior Strategy Session suggestions as buyout targets, like BRCD HAIN, have not yet been bought, those stocks have fared very well over the past year since the analysis was made.

We are going flesh out the process for deciding which buyout targets to consider serious buys, even in a bull market with merger deals more common.

When dealing with potential buyout stocks there needs to be a certain degree of discipline adhered to by traders. In other words, traders buying any old chart simply because the firm in question is a logical takeover candidate oftentimes find themselves trapped in a poorly-acting, unhealthy chart with small odds against lucking out on the eventual buyout.

Instead, the idea is to apply a “but-for” test, asking yourself: But-for the potential of a takeover of this firm, would I have bought the stock regardless?

If the answer is yes and you are dealing with a healthy chart, then you are not leveraging yourself entirely to a relatively low probability bet of an imminent buyout at a nice premium. If the answer is no and you are holding an unhealthy chart, then odds are that is what you will continue to be holding.

Updating our list, here are some viable buyout targets which pass the but-for technical test…

Please click here to continue reading

In the event we see a further rally this week, here are some actionable long ideas which are heavily-shorted.

Please click the screen shot below for a larger view of my “12631 FINISH HIM! SHORT KILLER SCREEN” inside The PPT. Obviously these stocks are going to have the highest percentage of shorts and, according to the algorithm, are set up well to squeeze further.

If this bull goes buck wild, this is a great idea screen.

Members can click here to view and save it.

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INVN and JMBA are two stocks consolidating impressively within the context of prior uptrends.

On strength, I would watching INVN over $26 and JMBA over $15 for upside breakouts.

Drop me your top tickers overnight.

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For your Labor Day evening viewing pleasure.

Back with some ideas and analysis later tonight…

The Trillion Dollar Bet (2000) – A documentary about the demise of Long Term Capital Management.