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Monthly Archives: July 2012

The Bear presses on (and the sighting of the Bear’s twin brother)

Asian markets are down and the evening trading of S&P500 is also currently down.  The evening star formation does foresee the bearish stance from time to time after all.  Without a doubt, I can see that, in tomorrow opening, SPY will surely drop below the median line support (see my note on the daily SPY chart).

I also see 2 supports ($135.89 and $135.263 on the chart) that if taken out tomorrow will mean that the Bear is taking over in the intermediate term.  Although I closed out my TZA and SKF positions before Friday close, I will restart my short campaign if price actions shows that the Bull cannot recover from the downdraft.

Below is the daily SPY Chart:

Regarding the sighting of the Bear’s twin brother.  Take a look at the weekly SPY chart below.  Follow the bracket numbers in 2011 and compared it to 2012.  Notice both have the downward sloping trend lines.  While (1) to (4) don’t exactly match in shape and form comparing 2011 to 2012, but you have to pause to notice the subtle similarity that, with current S&P500 evening down move, a down (5) bar will pretty much “confirm” the possibility of the twin status.  What does that mean?  It means watch out for the next week weekly SPY bar formation.  If it going to reflect a long down bar like bar (5) in 2011, we “may” have a similar bar (6) in 2012.  Remember, we are only dealing with probability, not sure thing; therefore, there are always room to make adjustment during the week.

I also see 2 supports in the weekly SPY chart.  $133.82 is my estimate of the lower median line for bar 5 penetration; and $131.54 is the bar 5 trendline penetration.  If the trendline penetration become a reality, watch out!

Below is the weekly SPY chart:

Below is a broader view of the SPY weekly chart that also showed the general uptrend line before the “correction”.

Good Hunting!

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This Bull has resilience!

I’ve been looking for DJIA to break 200 points down move but this bull just won’t give in.  I could feel the resistance of the bull every times the bear tried to push it down.  I’ve to give the Bull credit for being so resilient!

As to the evening star formation, I just don’t see how a half-baked small range red bar can be convincing enough to carry thru the probability of a down day Monday; especially with the Bull fighting back so hard. I prefer to see the low of today to exceed the low of July 18th (2 days ago) but that didn’t happen.    Thus, to protect my profits from yesterday short campaign, I closed out all my short positions (TZA and SKF) so I don’t have to carry this over the weekend.  Nevertheless, I will revisit the short campaign if next week price action demands it.

Below is the daily SPY chart:

Current position:

Long-term equity: 9.5%

Cash: 90.5%

Good Hunting!


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Beware of the Evening Star

That is the evening star candlestick pattern I’m talking about.  If today downtrend persists, we will see the formation of this 3 bars candlestick reversal pattern.  Therefore, be mindful of possible correction and plan your portfolio accordingly.

Below is today morning SPY chart:

Below is how the fully formed evening star candlestick pattern looks like:

Below is the “probability” of what will follow-thru after the evening star candlestick pattern is developed:

Based on the example above, it is possible that SPY may test the low of July 12th at 132.60 if today close with an evening star candlestick formation.

Currently I’ve 18% of my portfolio in short position thru TZA and SKF.

Good Hunting!

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Doji at the gate

Usually when you have a Doji candlestick bar near the previous pivot high, it can be said that the bull is being “checked” by the resistance.  Not necessarily a bearish attack but it could be subjected to attack by bearish traders.

If SPY closes today with a Doji pattern intact; then tomorrow will be the confirmation day of either a continuation up pattern or a correction to the downside.  This confirmation can be seen by price actions taking out either the high of today (continuation) or the low of today (correction).

Since I’m already net short by holding TZA and SKF; I’ll keep these position open for tomorrow and see which way the wind blows.  I can’t say the probability is on my side but then a doji at resistance is usually an ominous sign.  Who know, I may be speaking too soon since the day hasn’t close yet.  Therefore, we may not have a doji bar after all.

Below is the daily SPY chart with the doji pattern on today bar:

Current position:

15.6% short (bought TZA and SKF)

9.7% long-term equity

74.7% cash

Good Hunting!

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Flip Flop Day! Bring your own Short!

Today at 10:00am EST, the market announced Flip-Flop day.  Giving the general confusion of why we even rally this week, this announcement should not be taken lightly.  As usual, being sensitive to market pulse (am I being TOO sensitive???), I closed out all my long positions with a small gain, and went short by buying TZA and SKF (again!).

Will I be proven wrong again by being too quick on my draw and shoot my own foot again?  Who know.  But I’ve my stop losses on my TZA and SKF in place.  If these stops are taken out, I’ll take a break from the market and read a book, take a walk, or smell the roses since I may have lost my sense of direction to the market actions.

Below is today daily SPY chart.  Is July 3rd high now becomes a possible resistance?

Current Position:

12% 15.6% short (bought TZA and SKF)

9.7% long-term equity

78.3% 74.7% cash

Good Hunting!

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This week SPY story- working on taking out the July 5th high

Before we know it, by mid-week, SPY has almost made 2 points in its objective to take out the July 5th high.  It has not done so yet; but it is getting very close to doing so.  Once the 137.80 pivot high is taken out, next objective is to try to reach for the “X” in the chart.

Despite doom and gloom fundamental economic news, the SPY just keep on going and going and going UP.  Will the battery ever run out?  Better watch out for the day when the battery just “disintegrates” into nothing.

Yesterday morning correction spooked me out of a perfect positional play that included SZYM, DDD, and SSYS.  While I made money on these when I took profit yesterday morning, I left another chunk on the table yesterday (SZYM) and today (DDD & SSYS).  Of course, this was all hindsight speaking.  In retrospect, I didn’t have the “nerve/feel” to get back in after price went back up by market close yesterday ’cause I was out and was not watching the market during the day.  Sometimes, if you take yourself out of the market by out and about doing something else; you can feel “disconnect” from its life-force when you come back to it late in the day.  Hence, my inability to buy back DDD & SSYS before the market closed yesterday.  Today run-up on both was a big miss for me.  Oh well, water under the bridge so I need to move forward.  And yes, this will not be the only time I will miss big; I’m sure I will continue to miss big move from time to time.  Thus is the way the market works.  I have to accept these conditions as part of the way I traded and move on.  On the other hands, my quickness in getting out of positions, while robbed me of big gain from time to time, also saves me from numerous disaster from fast falling prices.  So, from an overall scheme of thing, I’ve to say I’m ahead in some form.

Good Hunting!

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Is it corny to buy corn?

No, I don’t think so.  I’m going with the Fly’s thesis.  If we don’t get rain anytime soon, the drought can become a very serious issue.

Currently loaded up on:

MOS  LNN  MOO  POT  CORN  SYZM  SOYB  (32% of portfolio)

PRLB  TBT  (7%)

Long-term equity (9.6%)

Cash 51.4%

Good Hunting!

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Bullfighting event- Time to observe on the sideline

Yeah, this morning got me all excited and I dumped all my positions except for the long-term equity to lock in profits.  I bought TZA and everything seemed to fall into place ’cause even my TZA was making money.  After I placed my stop losses for my TZA positions I took off to take care of other things.

Lo and behold when I came back to watch the market; my TZA positions was stopped out for small losses and the Dow Jones is hovering around +90.  Such is the volatility we have to deal with everyday.

Do I regret selling out this morning?  Nope.

Since I knew I’ve to take off in the morning and the market was on the defensive, I wanted to lock in profit before I took off.    I also know that I will be looking to buy back some of what I sold later on anyway.  One way or the other, I got my peace of mind doing what I needed to do.

However, as this point, I’m not exactly eager to buy back what I sold even though the Dow is up.  Except for SZYM,  I didn’t really miss much by selling this morning.   With only one hour left to go; I prefer to wait to see how the price action behave tomorrow before looking to buy or short.

Looking at my quote list, I’m baffled that at least half of the stocks in the list are in “red” ink even though the Dow is up.  This tell me that there is a bullfight going on.   Therefore, I’m quite content to sit mostly in cash to see what my options are tomorrow.

Yes, I’ll be lying if I don’t feel “bad” about missing the 6% move on SZYM; but that the way the ball rolls when you play safe with no discrimination.

For a small consolation, I bought some TBT before I took off this morning and it still looks good.

Current position:

9.7% long-term equity

3.8% TBT

86.5% cash

YTD gain  18%

Good Hunting!



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Shifting of the Wind

I don’t know about you, while the SPY opened UP; there seems to be a lot of wind blowing against my face instead of propelling me from behind.  Before seeing my gain evaporating from yesterday lucky gain; I do not ever forget the “essence” of the musical chair game we are playing here at the stock exchange.  Needless to say, I immediately took profit when there were still chairs left to grab before the music stopped.

Took profit on all my positions except my long-term equity.

Current position:

Long-term equity: 9.6%

Short (bought TZA): 5%

Cash: 85.4%

Good Hunting!

ps. I will add to TZA if it takes out yesterday high.


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The alignment of Technical and Fundamental–> 3D Printer (DDD & SSYS)

Look at the beauty of the daily to monthly charts of DDD.

While the daily DDD below showed some “wavy” up and down, the overall general trend is still up.  Fundamentally, DDD’s CUBE consumer product line “may” be a hit due to being recognized as “Cool” by Stuff Magazine.  We will soon know enough if that “cool” factor also reflects positively on the earning report come later this month (I believe it is July 26th).

How much more catalyst (fundamental) can we get when WSJ proclaimed “Next 3-D Frontier: Printed Plane Parts “?

Technically speaking; please see below daily to monthly charts:

DDD weekly chart below:

DDD monthly chart below:

At this point, I believe it is quite safe to say that the direction of DDD is UP.

I’m glad the daily chart gave me the opportunity to jump back in last week.  Now, let’s see if the coming earning report will “surprise” in a good way so that the uptrend can continue upward for yet more glory days to come.  Perhaps, the 3D printer industry is now thrust upon us sooner than most expected.   Only the numbers can confirm; therefore risk is always around the corner.

Good Hunting!

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