All the weakness early in the day was convincing enough that I reduced my exposure, selling YELP, before watching the market reverse higher and close near the high of the session with a big tail print in its wake.
This was a bullish session. It traversed our entire range, nearly a month old. Sellers made one final attempt at a stand around 2:30pm but we ultimately mowed over by a powerful whoosh higher. Now we must smoke any remaining shorts out from there holes, using our almighty PPT (wins again, big time) like a fish finder.
Remember, this is the last full week of trading on the year, after which things get light, fluffy and thin. There is still time to get your shopping lists complete but you have to act soon.
Santa Ben has snuck into our homes, using his Decetaper cloaking device, and planted hundreds of Christmas treats around. Are you going to sniff them out and eat them?
I have 15% cash burning a hole in my pocket and a big GOGO long riddled with angry, trapped elves. This ought to be an interesting holiday.
The markets sold off into the bell today after a session of chop and indecision. This environment, of balance, is allowing momentum stocks to start working. The high risk stuff, the strong stuff, like #teamsocials, GOGO, #teamsolars, and TSLA went to work—chipping away at the fragmented spirits of Christmas shorts.
My book rocketed higher for a second day, propelling me 1.5 percent on the day. The hot knife of momentum cuts both ways. I sold some BALT today. Not much, a third of my position. This is my method of swing trading. When I reach a logical level of support or resistance I pull out my magnifying glass and stalk an exit. There was a seller up here at prior swing highs. There almost always is a seller at prior swing highs—in all stocks. Jumping into a name as it breaks out worked throughout much of the year, but a more astute trader works tirelessly to position ahead of the move-to-breakout. That way, if you are wrong you can usually scratch the trade.
I sold GRPN too. I had a quick 5.5% in profits and I took them. I do not particularly love Groupon, and ½ the deals I buy usually expire because I work too much to enjoy restaurants in a timely manner. Most importantly, to my eye, buyers are getting a bit ahead of themselves.
And I needed the cash.
These sales took my cash up to 15% as we head into what may be the day to bust us out of balance. We have lots of news flow on tap tomorrow and a tightly coiled market. I want cash to either buy new charts should strength emerge or gobble up deals as liquidation sets in.
I had a firm grip on today’s intraday action. I bought the early dip and sold the afternoon rip. I felt pretty fancy. My low blog view count stats affirmed my context was deadeye dick accurate, as they always fall off before I made a big win.
The buyers rolled out the cavalry early on, buying up the indices, only to retreat after an hour of progress. I heard (read) several seasoned traders speak of a subtle change in the character of the market these last few days. I like to go heavy on context work because these subtle cues come from the footprints of the marketplace.
We need to understand what timeframe is in control on a given day. By establishing what timeframe is in control, we can decide what reference points become important. The drive higher early on looked like the long term timeframe taking control of the marketplace but we later learned that was not the case. The rest of the day we faded the early strength, a slow move lower controlled by the day timeframe sellers. Intermediate term we lack a clear victor and are instead experiencing balancing trade.
In summary: Long term – buyers firmly in place, intermediate term – balanced/two way action, daily control-buyers, and intraday control – sellers. PPT nailed a swing low for now, which is always fun(d), now it is a matter of building upon it or sellers blasting through it with old school scud missiles.
When we land our hot air balloon in the thick forest and begin investigating individual trees, we can see risk still being engaged in the marketplace. Alternative energy plays caught a bid. Solar stocks started seeing some inflow after an orderly, mind you deep, pullback off the recent highs. These issues will be interesting to track into year-end as to whether they can put in a higher/tradable low here. I am long FSLR and YGE from higher prices, -9% and -15% respectively.
I thought I was getting cute last week, selling off my “bottom shares” in RVLT. You know, the ones I bought at the beginning of September for two fifty. Lo and behold, RVLT rips higher after signing a contract with the Navy for 17,000 LED tube lights. This is one of those deals that seems big, but in the grand scheme is really small. That type of installation however, could yield over 200k in profit margin given the company’s current revenue structure. I think the market excitement comes from the hope that this is only a primer deal with more potential deals in the pipe. Investors.com also published an LED pumper piece Friday evening which may or may not have contributed to the inflows in LEDs today (h/t @randadtrade).
However, you did not need to know about the pumper piece or the Navy deal to get long RVLT last week. No friends, you just needed sentimental confidence as was on display by iBC comrade @Eliza_Mae_iBC who spoon fed the trade in what he called the “holy grail” chart setup. He shared his thoughts after I sold my “bottom shares” like a jacked-ass. Fortunately, I still was ¾ sized into today move. Even Raul, faithful to the LED tech, became discouraged. I bought more CREE this morning to repent for my loss of faith. Side note-yes, Twitter is useless. You should believe what these analysts tell you. You would not want to encounter likeminded people who engage in real-time, money making conversations, I know.
I still like my OWW shares, as they do absolutely nothing but go sideways.
That’s all that was done. I was up 1.75% today. With a little bit of market cooperation, I just may hit my annual target.
The selling continues this afternoon, with sellers continuing their blitzkrieg campaign with a 2pm algorithmic shock wave. A block trade like the one we just experienced at 2pm is a way of starting a siphon—the algo sucks on the tube with the intent of motivating atmospheric pressure to move liquid(ity). Once it starts the flow, a force of equal or greater value must arrive to stop the force.
There’s nothing wrong with sell algos, they just receive more criticism then buy algos. They are both attempting the same feat.
Keep the context of our market in mind. It is mid-December, we have had a huge run, correlations are low, the long term trend is higher, risky assets continue seeing cash inflow, and sellers just controlled their first week since mid-summer.
With that in mind, and despite my extensive coverage of the indices, I think it is important to keep your focus on individual setups and how they are behaving.
My book is going out 95% long after purchasing OWW today at the top tick. I have other names of interest, including LEDS basing just below one dollar.
My AMZN YOLO lottery ticket was a loser. I risked the entire premium because it was a lottery ticket. It had a moment of hope early on, but could not breach recent overhead supply. The trade needed more time than one day. I realized this soon after taking the trade, and was discussing how TSLA would have been a more prudent YOLO…if there is such a thing.
I never grabbed ENPH yesterday. Instead I just watched it and commented on it. Now I cannot buy it and it can likely go much higher. I simply lack to conviction to assume nearly 20% more risk.
My book of stocks spun donuts in the mud this week even though I have winners among my ranks. Here’s the book, largest-to-smallest:
BALT, OWW, FSLR, GRPN, TSLA, YELP, RVLT, YGE, Z, LO, WBMD, GOGO, CREE, F, and my bane MJNA.
Final word of on the market – this looks like discouragement phase, where the market makes an earnest attempt to steal away your favorite shares. Review your risk plans, make adjustments where necessary, and stick to them. Do not assume gains are guaranteed.
We are fast approaching one month of static returns for the book of Raul. November 18th my book peaked in tandem with the swing high in ONVO and turned lower. Still much a drunken off my superfluous hot streak, I bought WLT with funds from cashing out of AAPL (note: this required me buying said shares a few days later. It was a sublime exit and reentry, traded like a true scalper, but perhaps more than necessary for a swing book) and cut losses on SFM and YGE.
A few short days later I bought the dip in GOGO and more CREE. The GOGO and AMBA are who returned me to prior portfolio highs and propelled my book gingerly above prior high mark last Wednesday…you know, back when the market was going down and I was 90% long. Then starting Thursday the bulls stampeded higher. SOL also sent a chill across the collective spine of solar stocks, especially the YGE I have been so eagerly accumulating, effectively sending me back to Mid-November gains.
So much progress forfeited in the name of MOAR. The worst part is I like solar stocks even more at these prices. Goodness, if my book had any cash lying around I would have been buying FSLR today. Am I sick? I do not believe so, when I observe the FSLR weekly chart (I know, stretching my timeframe to justify a trade) I see exactly the type of conditions I thrive in. Have a look:
So I may forego hitting my 33% return goal on my swing portfolio, darn…I really need that money January 1st to buy tacos and such. I suppose what I am saying is I do not answer to anyone, this is my money, and I like my odds over the next few weeks. It is the god damned holidays anyhow, who wants to be ferreting for giblets when they can play Edward ham hands?
I doubt however that I could play this trade as slow as LED. That trade has been violently dead since the summer. Net-net they are a very green shoot in my annual performance, but we have been operating on the wrong side of the chart for quite some time. I suppose the shear age of this correction and my optimism for the industry as a whole is what has me currently positioned more aggressively now than I have been since early March.
Final thought, the NASDAQ is up 3% since November 18th. I am unchanged. This means nothing to you. It means everything to me when I glue my brain to NASDAQ 2-6 hours per day. Here’s me verses the indices:
I am still 100% long. I tried doing something, anything today, and no matter how hard I tried I could not justify selling anything. I feel good about that. Selling for the sake of selling, driven mainly from emotions associated with wheel spinning, seems like work for the sake of work.
When something breaks I will fix it, and I can’t sell YGE down here. I can sell it lower. I can sell it higher, but I can’t sell it here.
Fri Dec 6, 2013 3:43pm ESTComments Off on Fuel Cells Friends
You need to be keeping fuel cell technology on your alternative energy radar. With TM talking about fuel cell cars in Japan 2015 and USA 2016, PLUGs optimism this week, and more and more technology companies installing the systems at their headquarters it is time to put these names on your radar.
Courteously of The PPT search function, I was able to quickly cue up the players in the space. Look at these charts, things are definitely heating up:
Being young has its perks: strength, vitality, ease in courting, and lots of time to capitalize on disruption. Disruption takes time because it must combat stubborn old folks, hell-bent on preserving their precious cash cows.
My book is a snapshot of the biggest disruptive forces right now. Let’s have a look, shall we?
LO – electronic cigarettes, big tobacco
CREE & RVLT – LED lighting, 9 billion aging lamps
YELP – food and service review, Zagat and Google and traditional advertising
TSLA – electric cars and the supporting infrastructure, big auto
TWTR – I have no idea what twitter is, disruptive
AMBA – high definition cameras for cheap, expensive cameras and professional filmmakers
AMBA had a solid beat on earnings yesterday, but is getting the fade treatment today. Just this morning I procured shares near the highs. They are off a quick 4 percent. The question is, do I care? It is always a good time to buy a winner. It will go lower. I will take heat from folks on the internet, buy more at some sweet inflection point, and then ride into the sunset on the bucking bronco. It is always a good time to buy a winner.
I am all in, 100% long for the time being. There are other names—companies much less disruptive then the above who I hold as trading vehicles (cough cough solars) that compose the rest of my book. But I am 16 longs, 0 shorts. I have now made my bed atop a pendulum high on the upswing. Can it levitate higher, or will I fall off when it swings lower? TBD
I see you there, looking at my stocks, chomping at the bit because you never pulled the proverbial trigger. I always know winship is around the corner when my morning analyses are devilishly accurate yet undeservedly ignored.
GOGO whoops
TSLA blastoff
I just so happen to be holding two of the most vile momentum beasts while they are violently ripping higher. You want to see violent? Cue up the above two charts, vi-o-lent. That is the joy of momentum trading. If you haven’t been on the ride yet, keep working on your plan of attack. Fine tune it. A good plan is amorphous like water. You are the surfer right? Do you want some manager surfing for you?
How is that fun?
Winning is fun do not let anyone tell you otherwise.
I am holding some dogs. I would not hide that from you. I have a sizeable RVLT position. It could die tomorrow. I hate this company something solemn. Imagine the most wonderful beach in the world, inhabited by only the naked bodies of Greek mythology. Now imagine every time you step a toe in the water to cool off you are attacked by a fleet of kamikaze black flies, hell bent on consuming your flesh. The management team at RVLT is that pack of flies. I proposed early on that a chimp could succeed if given the reigns at RVLT because they have the tools in place to mine the prospect of a lifetime. But perhaps these jackasses truly can muff things. One thing is for sure, their investor relations are nonexistent. My friends, that is not good business.
Let us move away from that sore spot, put my explosive wins aside, and focus on what matters most—what is my next trick?
It is twofold really, a move for the brazen and certainly not the meek: SOLARS AND SOCIALS.
I finally added to my TWTR long today, after riding a 10% drawdown from IPO. I like how it didn’t follow the indices lower today. It pairs well with my large YELP holdings.
I started new longs in FSLR and YGE today too, in that order. Although the sun does not show its face in the murder mitten, these charts say solar is ready to win. It all starts on December 5th with the SOL beat. Place your bets.
Of course, the meek shall inherit the earth. Thus to you I provide the following selection: KR and PPC #cantlose. That KR is the look right there, with a daily chart consolidating so tightly, and a catalyst in place. Big grocery just lobbied to victory in Washington over GMO labeling on food. You will need to look this up on your own as I am very busy. They will not be informing you of the toxins you consume any time soon. This is a win for KR and their new product—THE MASSIVE CHICKEN. Have you seen this thing yet? It’s twice the size of your normal, mildly hormone injected chicken. That means it can feed your ever expanding illegitimate family and their ever expanding waste lines.
I think you already know your catalyst for PPC, hehehe.
Finally, all hail The PPT, bestowing an oversold statistic at these unruly highs. This machine has become an invaluable arrow in my quiver.
Mon Dec 2, 2013 4:47pm ESTComments Off on Seller Took Control Today
On the day timeframe, we saw action that suggests the sellers gained control of the tape. It started with the open where sellers printed a wick on the top end of our NASDAQ profile. Looking at the bar chart the print has a smack of euphoria. From there came several subtle warnings as the tape went mostly flat. It began to feel like sellers would fail [again] to roll the tape over. Every time inventory became too short in the futures, a rapid squeeze would develop. However, they never made new swing highs. Then after 3pm the sell flow came back in and closed us out near the lows.
It important to keep in mind we are still in an uptrend and tomorrow has a hearty POMO on tap. However, should that liquidity be absorbed and price continue lower, we may have a swing high in place.
Early on I sold out of AAPL, Z, and BZH. I did not like how the puzzle pieces representing housing looked during my weekend analysis so I cut. AAPL had just made its biggest four day move in the last six months and I wanted more cash. I scaled off a small piece of my GOGO, sub thirty, regretfully, as 30 was my target on the day. I sold NUGT for obvious reasons (it was getting pulverized) and I sold an old holding in O, because it looked weak.
My only buy today was of WBMD. I chased a bit, thus I left room to add if need be.
The net of my actions raised cash to 21% after being 100% long into the weekend. Call it what you will, I want more cash on hand into what may be a challenging month.
CREE started printing an inverse head-and-shoulders reversal pattern while its small cap counterpart RVLT struggled. OESX took a minor beating too but may begin consolidating which would entice me to finally get long the name. LEDS looks to have printed a bearish engulfing candle on the daily chart. Overall, the LED industry is still a mixed /weak basket of securities.
TSLA is getting a little dangerous looking and needs to find some buy flow soon. It looks to my eye to be setting up for another leg lower. Elon has a missile launch scheduled for tomorrow. Perhaps his motor stock will launch also. TM is promising to bring fuel cell tech to Japan by 2015 and Europe and USA by 2016. That means Elon has 2 full years to continue disrupting old auto. Tick tock Elon, keep making moves.
Shippers, you know them, you love them, and you hate them. This trade has been setting up so slow. It wants to lull you into a trance so you bail out of boredom then SPLASH, swing highs. It is still tough to get excited when I view my big shipped position.
Social media continues looking weak and there were reports of heavy put volume in crowd favorite FB. Overall sentiment continues to be bullish and that never bodes well for higher asset prices. For now, YELP continues to find buyers at the 99ema. If TRIP confirms lower tomorrow it sprung a nasty bull trap on speculators.
I would like to see some panic tomorrow, for olde time’s sake. Wouldn’t it be nice to get our one or two mandatory days of terror out of the way early? That way we can focus on gluttonous buying for the remainder of the year.
The chicken trade does not appear complete. I may need to reenter for the great ARISE.
The sellers have won the day. Two weeks back they won Monday-Wednesday only to get BTC’ed Thursday and Friday. Take todays win by the sellers in context.
