iBankCoin
I turn dials and fiddle with knobs to hone in on harmonic rotations
Joined Oct 26, 2011
4,121 Blog Posts

Quiet Morning – Unless You Pick Winning Stocks

The old me would be stalking EXK today like I did Miley Cyrus last time she was in town, but I’m comporting myself with a bit more grace and self-respect today…like Pepe Le Pew.  I learned not to chase miners, EXK in particular, through a long history of daggered hairpin reversals.  The name is volatile, I felt early on that I missed the action, therefore I did.  I’ll have to tickle my fancies with something else today.

I’ve quite enjoyed being kicked in the scrotum this morning by my newly minted long OCZ.  They came out with some preliminary earnings data rather out of the blue, and lo and behold they’re still combating supply issues.  “SUPPLIES!” …no surprise.  There are worse problems for a company to have, like no sales.  Anyway, the stock market is the final arbiter.  If the name doesn’t shape up into the bell I may axe it (no piker body spray puke).

I sold a bit more O which is fantastic, this trade played out LOCKSTEP, and now I have my final 1/3 which the market must work very hard to take from my person, as my cost basis (net of booked profits) is now $38.50 aka well below swing lows.  I hope we take out the recent swing low, run some stops, and then I’ll add some back on.  This is going to be my new AWK, collecting me a coupon while I skip to my lou though the market minefield.

My solar trifecta has me more pleasured than Lil Wayne ‘turked up’ on opiates at a stripper convention.  Take your pick: YGE, FSLR, and ENPH the sector is leading higher just as prophesied by the immortal Le Fly and other iBC cast members.  Use the green juice to power some CREE bulbs and you’re on the right track, guy.

DDD and PRLB did this morning what I like to call the bear pinch: drive lower, pullback for shorts to enter, make a new low, barely, than quickly rip higher, leaving asshole bears stuck in their underwater positions.  Have a great afternoon you harry bastards, it’s hot out there.

RVLT finally lifted off and it has done so without me.  I’m instead nearly balls deep in German LED play AIXG, down 1 percent.  All dogs have their day, RVLT is a decent company, but they’re no CREE or AIXG fundamentally.  RVLT is an instrument for degenerates to trade.

I’m happy to have paired my IMMR with some INVN because to me, they’re the same thing: new tech, chips.  INVN appears to be more en vogue.

F won’t let good Americans in unless their 401-k is set to ‘auto-allocate’.

FB still wants to win, while you’re looking elsewhere.

I’ll never own enough Z, but I own it nonetheless.

TPX is still my largest.  You will all feel its gentle wrath.

Who thinks BPZ has another squeeze in it?  (Raises hand)

That’s my book in a nutshell.  I’m considering an FXY long as protection.  Call it Kong hedging.  iBC is becoming a formidable beast.

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Pressing the Peaks

I’ve highlighted a few pieces of market profile context to keep in mind this week as we wade into earnings with the market on the verge of all-time highs during peak summer heat.  A reasonable amount of back-and-fill would build round out the Gaussian distribution from Friday, taking us back down to 1664 without doing any real harm to the charts.  Even if we continue higher today without fulfilling this expectation, I suspect it will remain as unfinished business in need of reconciliation.

Overnight however, we’ve see the market working higher, buoyed by in line economic data from Asia which sent their bank stocks soaring higher.  As the US wakes up and begins to digest this news we will see them pressing the futures in either direction.

The last two sessions have built up plenty of energy, and we’ve been on the buy side of momentum for almost two weeks.  It’s just something to keep in mind.

I’ve highlighted a few pieces of support in the following profile chart:

ES_MarketProfile_07152013

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Sofa King Long

I’m watching these rusty shorts fail time and time again to break 1666 on the spooz in the most non-eventful trading session of the week and it got me adding long exposure.

I bought OCZ and then I bought OCZ again.  I bought some FSLR too.

These purchases were financed by sales of BPZ early on at 2.33 which was a pretty fancy fill and sales of Z at 64.14 which is only decent.  I still own pieces of both.

Cash, it’s low: 6 percent.

I would have loved to play some Friday lotto too, but my piker Think or Swim account got the 90 day ban hammer lol.  I totally forgot about that pattern day trader rule, but I like to segregate my pure degenerate money to ToS, my swing money to Fidelity, and my futures money to Mirus.

No trades in the futures.  If I don’t trade all willy-nilly, I get to smoke a stogie this afternoon.  No setups have triggered today.

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Bring in the Closers

The /ES printed a balanced overnight session in a quiet manner.  We have WFC and JPM earnings on tap here shortly which may get the market moving.  The 24 hour profile suggests we may see some back-and-fill action, rounding out the bell-curve and taking us back down to around 1664.  The order flow as we approach cash open however, suggests we could be setting up for another ramp higher.

I suppose we’ll have a better sense of the market’s early direction once we hear from these two large banks.

Two key levels of support today are 1667.50 and 1660.75.  The latter level marks the upper bounds of the big after hour’s short squeeze that occurred when Chairman Ben said what needed to be said.  Losing this level could result in a liquidation snap, at least 50 percent of the way, down to 1654.

Above on the S&P, we still have the high water mark, 1680 to shoot for.

After a strong week, how the market goes into the weekend will be interesting.  Will we see profit taking and consolidation?  Or will the market continue to press the accelerator into the floorboards?

I’ve attached the following 24-hour profile chart to give you an idea of the consolidation context I initially wrote about:

ES_MarketProfile_07122013

 

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OPEN THE GATE!

My office was rife with distractions today as the typically quiet folks of finance dipped into a barrel of beer and invaded my workspace all-too-frequently for its VIP view of the streets below.  Damn these fools, seriously, they’re demented humans who don’t get out nearly enough.

Pair that with Multicharts having an impromptu mandatory software update, and I was rendered useless in the futures market after the clock struck ten.

I’m brooding so hard right now.  But what the hell, everyone’s having fun, yes yes yes!?  Ben told the bulls, “we ridin’ round we gettin’ it.  It’s mine, I spend it.”

Ben put his flex on like an old tiger in his last fight—he’s not losing.

The S&P pit session was quiet today, but really fluid and without nasty trap action.  It went directional downward early on, and anyone with a brain would be trigger happy on their shorts, taking profits given the context.  So when a new low was never set, the market never even enticed chasing the shorts.  Then it marked time all session, then put in two nice little rotations higher to close out the day.

I missed the afternoon rotations, hence the brooding.

Perhaps that is why I bought BPZ at HOD today but let me explain a bit more.  They say if you feel like you’re missing out on the action, it’s already too late.  When I pulled up BPZ this afternoon, I didn’t feel a sense that I had missed anything.  I see this type of setup all the time, yet I never take it.  A stock launches over 10 percent higher in a single session on strong volume and closes near the HOD.  The next day it makes an even BIGGER move.  Pair that with the following bullet points:

1.) http://ibankcoin.com/flyblog/2013/07/10/a-titanic-shift-in-the-oil-markets-are-underway/

“On the other hand, surging oil prices is good for a number of sectors, such as solar, alternative energy and good old fashioned exploration plays who bank coin off the price of oil going higher.”

2.) It showed up on three of my favorite PPT screens too, including receiving an upgrade to BUY.

I’ll quickly run through today’s portfolio adjustments:

I took my first scale in O.  You have to get paid when the market pays you.  Now the move can either continue progressing or digest for a bit and I’m chill.

I took my first scale on TPX.  It’s still my largest position and top pick.  Next target is $50.

I bought PRLB, INVN, and BPZ like a cheetah chasing a gazelle.

I took cash down to 12 percent, and my positions, listed largest to smallest are as follows (top picks bolded):

TPX, FB, AIXG, INVN, DDD, F, Z, IMMR, CREE, PRLB, SD, BPZ, O, ENPH, YGE

I want some EXK too, call it position overload.  I did this last time we peaked out…FYI but I won’t be fooled twice.

EARNING’S SEASON STARTS TOMMOROW MORNING-PREPARE FOR WAR

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Pushing the Limit

We’re approaching the cash open over 15 handles above yesterday’s close thus today’s gap is of the professional variety.  Therefore, attempts to fade the gap intraday will be much more difficult than your typical gap.  This also gives us a puzzle piece: if the gap were to fill that would be very unusual and could signal a peak in the recent move higher.

I’m not saying that’s what’s going to happen, let’s be clear about that.

The large gap does mean today brings higher opportunity as the market is out of balance and must now work the buyers and sellers to re-establish appropriate levels of auction.

Today I’ve zoomed out to see where the S&P 500 is trading via the rolling e-mini future contract.  As was suggested, we’re testing the very upper bounds of a potential range. With the exuberant reaction to Fed Chairman Benjamin’s commentary yesterday evening we’ve wasted no time with 1650 which was of huge significance during May and June.  Instead we’re pinned up against the next major level 1667, which features many of the May peaks and marks the upper quadrant of the 05/22 peak event.

The highs are now just an earshot away at 1680.25 and the question becomes, did we get a level of padding as we enter a patchy earning season?  Are we destined to be range bound this summer?  Or will new highs be made, and met with a flood of initiating buying?

It’s a challenging environment, but in terms of intraday trades: when the overall trend is higher, you give your longs more room to run and allow support a fair chance to work.

It should be a challenge for mean revision to set in today.  Again, I advise you pay close attention to the earnings out of WFC and JPM Friday morning, and then C, MS, and YHOO on Monday.  They should provide direction at this interesting junction.

ES_DAILY_07112013

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We’re Really Going to Miss this Guy

I was having a modestly red day in the futures, but I stuck around and traded through the Ben, and now I’m happy to go home very green!

I bought two dips, sold two rips…Ben is a really good guy.

There was so much selling pressure today, especially after the FOMC pop was faded, that I knew any upward momentum could get these shorts running for their dear, stupid, lives.  And Ben delivered the crack rock.  As a matter of fact, he’s not even satisfied with the 6.5% unemployment threshold initially rolled out during the taper talks.  He’s convinced we’ll need to keep on easing well beyond that, blessing the market with capital gains until everyone is back to work.

Obviously this news is very bullish for TPX because, as unemployment drops, procreation must increase.  The safest way to procreate is within the confines of your bed.  So get a nice one, yes?

Anyone want to take bets on where we open tomorrow?

It’s a long way until 9:30am…

I’ll quickly run through today’s portfolio adjustments:

I dumped AAPL for a scratch after riding the name through a trough.  I can’t get excited about this name because it’s literally falling behind the power curve.  That’s dangerous in any business.  My assistant mocks my ghetto 4s about once a week and then changes the channels with her Galaxy.  It has the infrared beam like your teevee remote.  Plus I wanted to sell it at yesterday’s low, so why not sell it today, near the highs?  It can go to $1000 and I still won’t regret this decision.

I scaled off some Z as it pokes around near the all-time high.

I cut my ANGI long because I don’t have patience for it when YELP is crushing, Z is crushing, and ZNGA is flirting with me.  What was once a 6% gain was booked for a 5% loss.

All of this left me feeling cash heavy aka homo erotic.  So I scuttled into DDD and SD.  DDD is ¾ size and SD is ½ size.

I closed the day 80 percent long with TPX of course being my largest position because my top pick continues to be TPX, got it?

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Marking Time

The S&P has done very little so far today, more or less marking time in a very non directional manner.  The only play has been to fade the extremes.  There has been a slow and steady pressure on the bid all session and we’ve traversed yesterday’s entire value area.

We’ve seen range extension lower which suggests we may have already marked the high of the day.  However, we’ve seen a slew of neutral sessions these last few weeks which feature range extension in both directions.  Keep in mind however, over years of daily data, these formations are very uncommon.

I’m from the school of thought that we’re in a summer range, and I believe we’re near the high end of it.  Buying up here thus becomes a higher risk game.  However, We’re yet to test the upper bounds of the range, upward of 1650 -1660, and it seems appropriate to touch those levels before traversing the range again given the “max pain” aspect of the markets.

We could certainly see activity pickup this afternoon after the 2pm FOMC minutes, and perhaps a tradable trend will develop.

In the meantime, individual names are still offering tradable opportunities, and my top pick in this environment remains TPX.

Here’s the quiet profile thus far:

profile

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Striping the Field as We Await FOMC

The overnight session printed two small rotations lower, taking us around three handles off the closing print.  Should price sustain these levels into the opening bell, the placement suggests we may see a quiet morning auction.

The buyers may make an early attempt to fill the small gap, taking us back up to 1646.50 and perhaps press into yesterday’s value area high at 1648.25.   I suspect we’ll find sellers here, at least initially, as the market awaits the FOMC Minutes at 2pm and the Ben Bernanke commentary after the bell.

It looks like sellers will have a hard time pressing into Monday’s value, but should the selling accelerate, I would look for the market to test down to 1632, which is effectively the launch point from early Monday.

I’ve highlighted these levels in the following profile chart:

 

ES_MarketProfile_07102013

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Close But No Cigar

I put some oomph behind the old saying because I rather enjoy the occasional cigar.  Whenever I have a thousand dollar day in the futures I go to the shop and pick up a few cigars.  Since starting in April, I’ve done this three times, which is pretty cool, considering my largest position is only three contracts.

But lately I want more cigars.  I know…it’s bad for my health, sure.  Perhaps it’s a summer thing: chilling poolside with a cold blonde ale and a warm blonde female, it’s nice.  So I’ve updated the requirements.  If I can go an entire week without deviating from my plan, then I earn a cigar.

That means if I do what I’m actually supposed to, eliminating the gut trades I LOVE TAKING which statistically speaking donate money back to the markets 67 percent of the time, I can smoke a cigar every weekend.  How vile is that statistic? Can you imagine being wrong that often?  Net-net they’re not profitable either, believe me.

I need to snap this caveman tendency.  Punching walls with my head doesn’t work.

Does anyone else subject themselves to such Pavlovian rewards? If yes, I’d love to hear them in the comments below.

Thanking you in advance,

Raul

PS How goddamn annoying is that closing salutation?

http://youtu.be/TpH_e0of400

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