iBankCoin
Full-time stock trader. Follow me here and on 12631
Joined Apr 1, 2010
8,861 Blog Posts

Staring Into the Big Blue Abyss

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I have been cautious on IBM for quite some time, as I believe the long-time market bellwether had been throwing cold water on the bull with its underperformance throughout mid-late 2013, and most of this year too.

Today’s sell-off exacerbates the long-term technical picture, as the stock appears to be confirming a major top on the mostly timeframe, below.

I expect a move down to $130 in the coming month, based on the sheer size of the topping pattern. As you might imagine, that does auger well for the Dow and likely other major averages. A move back above $200 negates the bearish thesis.

Long-time readers will recall how wildly bullish I was on the stock in the summer 2010.

However, Big Blue has been a Big Value Trap for a while now.

I suspect the trap door is shutting as we speak for a good while longer.

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IBM

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Five Stocks Flying at Cruising Altitude Today

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Courtesy of The PPT algorithm, here are the most current top five readings from my “12631 RELATIVE STRENGTH” custom-made screen, identifying which stocks are exuding some of the best performances to the market at-large at any given moment.

I look for stocks whose Daily PPT Hybrid Score surges, while the Weekly Hybrid has been negative over the past week. This can often yield stocks which are emerging from consolidations.

Members can click here to view and save the screen.

Sorted for at least 500,000 shares of daily average volume to ensure liquidity.

Please click on image to enlarge.

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2014-10-20_1227

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End of the Line for These Trades

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Earlier this morning, inside 12631, I sold the final piece of my INO Long for an 11.2% win–i discussed the trade last week.

I did also, however, cut some losses in a Russia long and corn, while cashing out of wheat for a win on most of the position and a loss on a final add I made.

I am back to full cash here, as the market tried to make up its mind where it wants to go next.

Thus far, the tape has yet to tip its hand, though small caps over $109 on the ETF likely means more bouncing.

What are you trading this morning?

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The Big Skew by Big Blue

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On those trading days when IBM, or “Big Blue,” the very heavily-weighted Dow component, makes a large price move but the rest of the market is not quite in sync with it, we often see bizarre skews among the major averages. This morning, indeed, appears to be presaging one of those session, with Big Blue down hard, over 7%, while some major averages are green.

I am likely to wipe my portfolio down today, as I sense the market is at a major crossroads this week as to whether the follow the 2013 playbook for the automatic recovery from any apparent technical damage, or instead embark on a fresh, corrective leg lower. I am still thinking the latter, but newfound shorts may be in for some pain first.

NLNK is a hot biotech this morning and worth keeping on the radar as a day-trade on strength.

I will be back in a bit with a long-term chart of Big Blue.

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A New Look for the Weekly Strategy Session

Over the last two weekends, I presented my Weekly Strategy Session in video format.

Here is the full Session from two weekends ago.

Please click here for more details about trying out the service. Note that 12631 members receive the Strategy Session each weekend at no additional cost.

Direct Vimeo Link Click Here

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Night Owl Open Forum

night-owl

For you night owls out there, feel free to drop me any market/trading-related topics you would like me to cover in a weekend video.

In addition, anything else about the current market, feel free to drop below.

Speak your mind, night owls.

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