Last night during our market analysis segment, we discussed how to determine the upcoming bounce in stocks. It would be seen through a divergence.
Recall how we blueprinted the September pullback. We paired the Russell and Nasdaq against the Dow and S&P. Take a look:
Here’s a snapshot of recent price action, showing a change in leaders/laggards.
Today, we had the divergence signal. The Russell and Nasdaq, which have been lagging the Dow and S&P are now leading (up 1.5/1.7%) while the Dow and S&P are lagging a little behind. Looking at our social media group focus last night, those stocks broke down, trapped bears, and are now ripping to the upside.
Well played guys.
Top picks: X, CLF, APOL, FSLR, YELP, LNKD, GRPN, SOL, JASO
OA
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GOGO TSLA SCTY CZR SODA cause: it’s a bull market, you know 🙂
WFM just bought
A fan of Chicago Sean?
don’t who that is
$GOGO is a GOGO!
Would you buy options is SOL? or just stock?
Stock
as good as this rally feels, it’s still an inside day after a very big reversal day
I was thinking the same thing. I wonder what OA feels about it. OA penny for your thought? The cool thing I thought was the rotation into biotech is happening at the bottom of the range for biotech stocks. So that one may have some good legs here.
FB YOLO 48’s at .12 – FTW
Tempting – they’re at .10 now.
bounced off support on the 1’s and 5 min’s – so playing the trend here. But ready to bail if it misbehaves 😉
My FSLR calls expire today, and theta is ticking! Wondering if I should get my money back now, or hold out another hour or two to see if it pops any higher for gain–thoughts anyone?
The stocks gonna go up pennies (after two spikes) whilst your options are gonna drop by nickles. I’d take the premium out and run while it’s still there (and I was in the same trade – see my post immediately after this one).
Done and Done–Out for a small gain.
Why I Like Trade Plans
Bought FSLR 8Nov 60.50’s yesterday @ .19 as a YOLO. Targeted 61 as an exit and placed the order accordingly at .45. Stock hit 61 and I filled – options did go to 52 for about a microsecond, then proceeded down to 27 then 22.
No way if I was steering would I have caught the bounce, and would have probably chased it all the way back down to 22.
Difference between a $750 gain and a $90 gain.
Another bad habit cured by OA (trying to milk every penny out of an option Friday trade).
well done and good pricing
As with sex, entry is everything !!!
🙂
appropriate exit can be important too.
lol, indeed. you mess up the exit, and it will cost you for 18 years.
RC good one. You speak like an experienced man!
So you think FSLR goes to lower before the new high ?
I think FSLR is a long term play with a target of $100. That said, there are dip buying oppty’s along the way – I don’t see it “popping” for a while (we already had that play two weeks ago), but it most definitely will go up in the long term. I just use 56-60 as a “today” baseline.
Thanks ! Always comforting to have the big picture.
Did you use conditional order? How did you set option sell price? Mid, bid, bid+.02, ask?
I put the order in before market open based on CBOE calculator and expiry. Obviously .45 was a TAD low, but better low and fill then high and miss.
Thanks. Thats good to know, since I can’t watch every tick, and soemtimes am out all day.
TPLM and BYD moving
had a couple positions blow up in my face. already in HII and ECL, will be watching PSMT and TMO and then a handful of other losers I am going to sell into some strength. Rough 2 weeks for me.
OA, do you make anything of EEM not participating in this rally?
I would add WLT to the list of top picks. Long stock $14.95 and added Dec 20 calls this morning on the retest. Plan to sell Nov 16 calls when it kisses $20
yolo trade for next week…JCP e/r on 11/20, 25% short float and a huge volume gap to $12…haven’t pulled the trigger yet
Bot 1/2 position at $8.25, like it.
SUNE calls last week would’ve been killer – missed opportunity although OA mentioned it more than twice 🙁
I grabbed some stock yesterday near the lows (10.53) — my only activity for the day. I wish I’d gotten some options, too.
I was in SUNE prior to these moves then doubled down and bought Nov 12s for a dime during yesterdays scare off. Now i’m hold two grips.
I’m fighting “the urge to do something” as OA puts it. It is so tempting to lock in gains after yesterday’s carnage.
Just log off and go out this is only recovery day 1
doesn’t sounds the worst idea to me….lot of non-confirmation in this rally back to the underside of the breakdown
Whos’ holding XONE into ER?
Me
gotta hold some XONE into next week and probably thru eps on 11/13 after market…this stock acts great with a ton of shorts..
Me
UNXL anyone?
never again dude
Wouldn’t touch it.
You serious about unxl? This looks like one off the ugliest reversals ever. I hope you are wrong but there has been no buyers all day
Thoughts on HOV?
Path of least resistance seems to be down not up, plus huge pocket at 5.20.
Really? Not doing a great job of going down. In other words if falls as much as it rises. Play any side you want.
Gotcha.
…and I’m holding this not feeling good about it.
Long stock $4.97 earlier this week with stop at $4.75. Still see homies making a move up, espacially after BZH earnings.
pfff, you’re golden then. I’m in at 5.17 from 2 weeks ago so feeling like I already should’ve stopped out. Learning patience. Agree with your homie thoughts as well (no homo) which is why I’m in.
Why is VMW sucking earnings were great and it was pretty resilient yesterday
Glad to no be owning UNXL…feeling sheepish I was out of the market today due to and office move yesterday…sheesh