I’m just hanging out, executing strategy trades.
My signals say this weakness should be bought, but again, I’m only looking for short-term swings lasting around 5 days. And, I use stops, religiously.
I’m going to give you all another list of stocks which meet the criteria for a good short-term swing.
Linear Technology Corporation [[LLTC]]
Gartner, Inc. [[IT]]
PAREXEL International Corporation [[PRXL]]
Websense Inc. [[WBSN]]
Ness Technologies, Inc. [[NSTC]]
CSG Systems International, Inc. [[CSGS]]
Federal Signal Corporation [[FSS]]
HealthExtras, Inc. [[HLEX]]
If you want to know what is happening, or if you are having a hard time in this market, check out this excellent article: How to Trade the Choppiest Environment in 50 Years.
After reading the linked material, consider it your homework to review the setups listed above, keeping in mind the overall point of the article.
Hey woodshedder,
1,2 1,2…(boooooo get off the stage IG)..
anyways im looking over some mining stocks overnight, as i want them to be fundamentally strong and not just technicals.
GGS, NXG, KRY
I’m sure one of these is a holder from here. Your thoughts on these three if you find some “time” to spare.
Anyways, this is give and take. So here goes if your into forex.
The USD/JPY will slide overnight, as bernanke is likely to signal something about the economy at 8 am. Excellent bear flag (my entry point)
IG- I research about 3 hours a night. Not even one minute of that research usually covers fundamentals. So, can’t help you with that aspect of the miners.
From a technical perspective, they are short term overbought.
I couldn’t get GGS to pull up on stockcharts. Of the other two, I would have to pick KRY.
Keep in mind I’m going long SMN tomorrow, which means I’ll be betting against the overbought miners and materials and chems.
i didm’t even read yur post. dont care. i just liked the headline. i agree. now go grill a hotdog and ride a wave.
Love the title of your post Shed.
Good Article. A little broad though. His overall theme seems spot on none the less. Your picks above have shown strength the last few months but some weakness recently. Buying that weakness, again, is spot on WS. Seems so simple, but getting myself into this mode is the difficult part. Thanks
Mr. Woodshedder,
I will apologize in advance for this sophomoric question. The charts you have posted with explanations of your technical analysis are excellent. Is there a web site or book that delves into this subject based upon principles that you embrace?
Hence my purchase of MDR … should add a stop but it seems that as soon as you do the MM swoops down and grabs all those stops … buying weakness still has it’s risks but most of the damage as already been done ala ELN and AKAM, no? I hope so!
Mr. Feltersnatch,
Good question. There are many books that delve into the subject of Technical Analysis. However, I’m not sure that I have any in particular to reference. Technical Analysis is deceptively simple. Most anyone can look at a chart, and draw support/resistance and trendlines. There are dozens of books out there on chart patterns. Most anyone can look at these patterns and identify them.
The hardest part of Technical Analysis is believing that it works, and having enough faith in it to trade the signals with firm conviction.
The second hardest part is identifying STATISTICALLY SIGNIFICANT edges. I’m not yelling there, it’s just that important.
Once you have identified a statistically significant edge, the third hardest part is determining whether the market conditions are suitable to deploy the strategy. It might be better to shelve the strategy for days, weeks, months, until the time is right.
And that is why Rob Hanna’s post was important, because it highlights that there has been a change in what works, and what doesn’t work.
Finally, simply buying weakness is not enough. Finding a weak stock is probably only 1 of 4 criteria necessary for profiting by buying weakness. The caveat is always the time frame. My time frame is short, like days or a few weeks at the most, and so that also plays a huge role in selection.
edwards and magee is known as the bible for TA.
great book, imo.
Woodshedder,
Thanks for the advice, I learned something new from just reading your reply.
Chivas,
Thanks – I see Amazon has the book you suggested.
Every stock I rec’d closed green. Even Fly couldn’t do that with his Gay Time Masheen.
Shed, I’m not trying to burst your bubble or blow Fly, but admit it, those companies suck and are not strong stocks. They are chopped broccoli.
Which doesn’t preclude a great trading vehicle, of course, so kudos.
The one thing you missed that plays a huge role in determining what I buy/sell is SECTOR (not shouting, it’s that important) and relative strength vs. peers.
Danny, who said anything about sucking, strong, or broccoli? They whooped Fly’s gay time masheen. ‘Nuf said.
But since you mentioned it, if a stock is trading above the 20 day, the 50 day, and the 200 day averages, would you not call it strong?
Did you look at any of the funnymentals? I don’t think you did, as they are mostly in the strongest of sectors, and some have beat and raised, recently.
***Added after I saw your addition about sectors**
Boone, I’ve got healthcare and IT/technology and semiconductors sectors represented there. Have not those been the best sectors?
The market was up 200, you clown.
My LEH or UYG blew away all of those 4th rate stocks.
I got a bad impression from lltc, websense and a few other stocks that I “hate”
Sure they all ended positive, but half (4/8) underperformed the market today. But I digress.
I didn’t look at the fundamentals, other than market cap and basic stats.
Take nstc:
It broke out of a year long downtrend in june 08, tested perfectly, and is overbought having moved outside of its trendline. Looks good at the 200 day at 10, or 2 pts down.
I assume there must be some edge you have via screen criteria that would make the risk:reward on this trade acceptable.
As I see it, there’s strong OH resistance at 14. so you’ve got 1.6 points up, versus short term support at 11.75 and 200-day at 10. The best performers in the sector are NCIT, IGTE, NSTC, PER. They have done phenomenally lately, but still have OH resistance coming up. Not what I’m looking for.
But thats what makes two sides to the market.
The main takeaway I had was that rob proved what I’ve observed. And other traders too, it’s just easier to link to myself. So given that I knew that about the market changes the entries and exits but not my criteria for stock selection. If that makes sense.
Everyone kill Woodshedder!
No worries Fly. You didn’t really think there was only ONE space alien magician, did you?
Wood,
KRY is gay as a French horn.
It is a Canadian company…
with a “license”…
to mine gold…
in Venezuela…
in a politically sensitive area.
So actually it’s like gay to the 5th power.
Chavez has done everything but take the (gayish) CEO’s lunch money since they started the very expensive process of trying to get gold out of the Los Christinas (sp?) mine there.
You know I’m a big fan of your Lucky Scientific Feng Shui Slide Rule Entrail Chart Reading Method, but this is the kind of thing that kind of puts me off pure tech analysis.
It can give you a beautiful picture of one tree and miss the fact that you’re standing in a forest fire.
But mainly I just wanted to say, “gay as a French horn.”
Have a great weekend.
I see you’ve been reading my archives, Anton.
Actually, Danny, I’ve never had the pleasure.
I owned KRY a couple of times over the past 3 years. The mine itself is great. It’s the world’s biggest untapped gold mine. Better, most of the stuff is about 18 inches underground. They do what used to be called “strip mining” to get it, tho I’m sure there’s some PC euphemism for that now.
I made a little money, but I thought Chavez would eventually figure he had more to gain by playing nice than in emulating the crazy dictator in Peter Faulk’s “The Inlaws” and the place would “blow up.” In a good way.
Wrong.
Right now I think it’s as bad an investment — maybe worse — than that big platinum mine in Zimbabwe.
But mainly I just wanted to say, “gay as a French horn.”
Nice Bob Dylan reference (i.e. with the title)
Anton, I would never have advocated a purchase of KRY. I was clear about going short the miners. I was given 3 choices, 2 of which were the correct symbol, in order to give an opinion. And I stated clearly that I never analyze the fundamentals.
Anyway, I see your point.
Actually, sometimes, If I’m planning on holding something longer, I will explore the fundamentals. Most times I only check to see when earnings is coming around.
Cuervo, good catch. Initially, the post was going to have the entire line, ending with Mr. Jones. I was going to highlight Rob’s post on how the market has changed in terms of what’s working and whats not working. However, when I thought about it, it seemed pretentious and arrogant on my part, so I went in another direction.
Big Dylan fan, ovah heah!
It’s one of my favorite Dylan songs Shed. Fits the market pretty well too I’d say.
Boca, and I thought you just liked the title…lol…What can I say, it was early in the morning when I read your comment.
It does fit the market.
Wood,
Understood, Sir. KRY just set me off. Obviously.
BTW, I’m a big Dylan fan, too, and I totally missed the reference.
Must be Friday.
Everybody have a good weekend.
PS: Chavez and his little beret are gay as a French horn.
Beret’s are queerer than Pinky Paulson.