All morning, the bear has been playing Peek-a-boo with us.  Is this for real or what?

Regardless, we have a mini-downtrend on a 15 min chart.  Price  is finding support at the 79 sma line.  For this bear to take traction, we need to see price take out the symmetrical triangle and  falls below the 89 ema.

Either we have another small range neutral day or a breakout to either up or down.  We will find out soon enough since we are at the time-of-day that some major decisions are being made by big money.

Below is the 15m SPY chart.  I updated the chart below after the close.  Look like there is a small bias to the bull since price action peeks out of the symmetrical triangle.  To me, it is still neutral and anything can happen tomorrow.

I bought back some TZA that was stopped out this morning at breakeven for another go.  I’ve a tight stop this time.

I still have my TZA position after the close since my stops did not hit.

Good Hunting!

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The shooting star candlestick pattern is what I’m talking about.

What we have here is a possible mini- confirmed shooting star reversal pattern.  Again, this is not a sure thing but merely suggesting a possibility.

With another possible reversal pattern (my speculation only) on the general market, I took profit on my WYNN while it was still trading above $103+ and will look to buy it back at cheaper price if I can.

Below is the daily SPY chart.  Perhaps, this time the correction will happen?

Of course, I bought starter position on TZA once again.  No SKF this time since it doesn’t move that much compared to TZA.  And I also short AAPL with put options.  I think AAPL is ripe for short right now.  Technically speaking, AAPL has a Bill William’s Bearish divergent bar today so I went ahead and short it now instead of waiting for tomorrow to take out today low.

Good Hunting!

ps.  Forgot to mention that I also sold my AIG I bought back this morning due to the development of a Doji bar.  I don’t like Doji bar at the top…

Currently I only have TZA and my LT equity with 85% cash.

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I do! I do!

This may be a long-term play for me since I’m buying this based on the weekly chart.

From the weekly WYNN chart below, you can see the Bill William’s divergent bar last Friday.  It is beautifully sitting on a 50% retracement b/w March 2009 low and July 2011 high.  Today price action convincingly took out the divergent bar high and took off furiously.  If this stock market rally has any leg and last week employment is the start of a recovery, WYNN will become a big WIN.  Hence my starting a collection of WYNN stock right now.  Will buy more if price action keep on taking out the next daily fractal buy signal.

Good Hunting!

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If SPY closes near $139.72 SPY closed today @ $139.63, therefore we have a confirmed small range Doji.  This is not good for the bull since it increases the probability of a development of another evening star candlestick pattern.

I’m taking my chance that this Doji in development is a bad omen for the bull.  I bought starter position on TZA and SKF once again.

Take a look at SPY daily chart below.  Notice that each of the correction started with a small range bar (some of them doji).  Will today be another preparation for the next leg of correction?

I placed my bet.  Let’s see if it will pay off tomorrow.  Again, I’m used to being wrong and my stops are in place.

Believe it or not, I got stopped out of my AIG, SLW, and possible EXK (still waiting) already due to my stops placement being under the 79 sma & 89 ema in my 5 minutes charts.  I don’t like to hold my position if the daily momentum is gone by close of day.

Thus, my inclination to buy TZA and SKF for tomorrow gamble.

Good Hunting!

 

 

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Was anyone surprise I was stopped out on AMRN?  You shouldn’t.  I told you already that it was a wrong pick.  Good thing I sold some shares in the morning to reduce my exposure; thus, my actual losses were actually less than my expected losses when my stops were hit.  As in The Fly’s favorite expression- even though I lost, I won because my loss was smaller than expected.

With the bull still “floating” up, my guess is that this is an inflationary bull run.  And what do you do when you make conjecture about inflation?  You walk the talk and buy some gold or silver.  I chose the latter and bought EXK and SLW for starter positions.  Oh yes, the charts for EXK and SLW look great!

Another one I like today is AIG.

AIG?

Yes, it is purely a charting decision.  I love the chart layout and the stock symbol “happens” to be AIG.

See for yourself in the charts below:

Below is the daily AIG chart:  Notice that price action today took out the highs of last week and is now trading above both the 79 sma and the 89 ema which to me is a big plus.   Notice that the oscillator also turned up.

Below is the weekly AIG chart: In this case, I see a “cup & handle pattern”.  Do you?  Well, it really doesn’t matter whether you see it or not.  What is important is that I “see” it.  It is my trade after all.

Hey, I feel pretty good about this AIG trade as well as the EXK trade (which is also The Fly’s trade).  But as you all know, I’ve been proven to be wrong often times; therefore, my stops are always around to protect myself regardless how I feel about this trade.

Below is the daily EXK chart:  Notice that price action took out the high of last Thursday and Friday with the oscillator turning up.  There is also a divergence b/w price and oscillator; with the price flat line on support while the oscillator is trending up from below the zero line.  These are all I need to see to give me the confidence to take the trade.  However, I’m very well aware that price actions are still below the 79 sma & 89 ema; therefore, I’ll be quick to get out of Dodge in this one.

Good Hunting!

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Ha!  I just qualify myself for being wrong; so I’m safe here.  Now, if I’m wrong about my being wrong, then I get a bonus!

With the market ripping up all morning and my TZA and SKF stopped out and my gain for the week evaporated into thin air; what can I do but to look for the next stock to hunt.  I think I found one.

AMRN

Fundamental speaking, they recently received FDA “limited” approval to their cholesterol reducing magic pill that is packed full of their patented Omega Fish Oil.  Because of the “limited” restriction being placed on the FDA approval, the price actions took a tumble and fell back to current level which I believe may be a bottom.

There are 4 keys to my theory to support a bottom here:

1) price is at 50% retracement of March’s low and July’s high

2) Bill William’s bullish divergent bar was formed yesterday and today price action triggered a buy signal by taking out yesterday high

3) The oscillator is turning up with today price action.

4)  Price is not too far off from the lower median line of the Andrew Pitchfork.  Btw, I drew the Pitchfork by lining up the middle median line so it went thru the middle of the uptrend.  Nevertheless, because price is below the pitchfork, caution must be placed in this trade.  My stop is below the recent pivot low of $11.20.

Giving these 4 supporting factors, I bought starter position on AMRN.

Btw, if you don’t like the way I took the liberty to draw my pitchfork, too bad.  Of course, you can always draw your own pitchfork the “right way” and draw your own conclusion.  As far as I’m concerned, all these technical mumbles jumbles are here to help me make a decision.  It is all there is to it.  A tool to give me  the confidence to make a decision to buy or to sell.

Yes, I may be “bias” by tweaking the technical indicators to fit what I want to see; but how is that an issue in any way when the “standard” technical indicators does not offer 100% guaranteed win to begin with?

From my experience, it is NOT the technical indicators that make or kill your portfolio, it is your money and risk management skill that ultimately determine your fate in being successful or not.   In other words, if you make trading decision by having a monkey throw a dart at the WSJ stock pages, you can still make money if you apply discipline and practice proper risk management.  But the question is, “do you have the confidence to take a trade from the monkey throw?”

Thus, if you feel the need to tweak the famous technical indicators such that YOU feel comfortable enough to rely on it to make a decision, I say “Go for it!”.

But you MUST practice risk management with discipline; otherwise, you will just blame the technical indicators for the “maximum pain loss”  instead of addressing your real issue at hand- which is your inability to cut losses quickly.

Below is the daily AMRN chart that shows all the 4 factors I mentioned above:

Good Hunting!

 

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My bet is that it isn’t going to happen.

I only have to ask myself this simple question, “If I’m a fund manager, will I buy a boat load of stocks now?”

But then, what do I know?

I’m only playing the hand based on Newton’s law of motion.  Unless there is a powerful force countering the current downdraft today, it will continue down.

The 10 minutes SPY chart below is showing a persistent down trend.   It is going to take a lot of fund managers to buy this up to start an end-of-day rally.

Currently shorting SPY and AAPL again as day trade and also long on TZA and SKF as swing trade.

Good Hunting!

Market close update:

So we did have a end-of-day rally here and it really screwed me up on my day trades.  Fortunately, I don’t day trade the same amount I did on the swing trade; so my thrill at the stock-casino wasn’t expensive.   But I’m still holding my TZA and SKF as swing trade even though we have an “ok” end-of-day rally.  The reason is because of 2 factors:

1) a long-tails doji

2) a confirmed divergence b/w the chart and the oscillator on the daily chart

The long tail doji may represent a major indecision today.  Although we have an end-of-day-rally, failure to close on the upper quarter of the bar today means the bull hasn’t really won today.  Doji at this point on the correction can mean the the downtrend can continue tomorrow OR a reversal will take place tomorrow to the upside.

HOWEVER, because of the divergence being confirm on the oscillator, I’m willing to continue my bet on TZA and SKF.

Below is the daily SPY chart:

Yes, I know, I’m talking out of my ass here simply because I don’t have a crystal ball.  Price actions that ended up in a doji bar can be confusion; so trade cautiously and trade with discipline!

Good Hunting!

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Netflix has gone thru many transformation since 2008.  It started off flying like a crop duster, bumping up and down over the farmland until it transformed itself into a P-51 Mustang in 2009 heading toward the sky.  From 2010, Netflix shed its old skin and took off like a F-15 fighter jet plane heading toward the stratosphere.  By mid 2011, Neflix was cruising on outer space as a space shuttle intending on orbiting around the earth.

Then something happened!

Netflix CEO Reed Hastings decided to write his infamous letter in mid-2011.

The fall was turbulent.  It fell thru the atmosphere like a hot knife cutting thru melting butter.  If you bought at or near the top, every hesitation would cause you pain and depleted your beloved coins.  The violent free-fall hit the support so hard in late 2011 that it bounced majestically back to the 130ish in early 2012.  But the big bounce was simply due to the force of the deadly fall more than anything else.  Eventually, gravity took it toll and Netflix resumed its nosedive once again.  It bounced again on the same support but only on a tepid level.

As of now, Netflix transformed itself into a submarine and dive into deep water.

But like all self-contained metal container that filled with living organism inside, it needs plenty of air supply to keep the occupants alive.  Thus, the question is, “does Netflix has enough air supply to keep shareholders alive while it is diving into deep water?”

As you can see the Netflix weekly chart below.  NFLX broke support and dive into the next support around 52ish.  If it continues to dive toward the next support at $41ish, I’m afraid air supply will run out and a dead spiral may happen.

I’m very curious about how Netflix is going to find the air supply here and I don’t think it is that easy when you are under water.  So, I’m testing my theory by buying NFLX put option even at this level.

The above parody is not to be taking seriously.  Netflix may well transform itself into a Transformer and fly off the water into the outer space in one moon shot.  That is why I’m buying put option only so my loss will be limited.

Good Hunting!

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Based on price action, I’ve a feeling that many people have their finger on the “profit-taking” button ready to press.  It’s almost like  everyone is waiting to see what everyone is doing.  All it takes is a fund manager to push the panic “profit-taking” button to begin the slide.

I’m currently shorting SPY and AAPL on a day trade and long TZA on my swing trade.  I may get my wish of getting some profit by end-of-day if some fund manager can just press the button and get it over with.

My bet is that by end of day, we will have a bearish engulfment bar on the SPY chart today.  This will mean a possible continuation of a correction that began yesterday.

No chart display today ’cause I’m busy watching my day trade position.

Good Hunting!

Market close Update:

Now that the day is over, my wish for bearish engulfment for the daily SPY bar for today is granted!  Seeing the possibility of a bearish engulfment bar , I committed additional fund to short the market (before market close) for the possibility of the continuation of down trend tomorrow.

Below is the daily SPY chart.  This is a bearish engulfment of a previous down bar!  What does that mean?  A higher probability of continuation?  Who know.  We will find out tomorrow.

Current position:

9.6% LT-equity

12.8% TZA & SKF (shorting)

77.6% cash

Good Hunting!

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From the monthly chart to daily chart, the divergence is there.  What does that mean?  Heed Fly’s warning!

From my perspective, trading in the near future is going to be a day-to-day affair.  Swing trade no more than 1 day to the next.  Anything that is 2 days or more and you are opening yourself to a surprise party; not necessary in the positive light…

Below is the daily SPY chart.  Did you see that last 2 times, after a small range bar was developed from the spike-up, the oscillator headed south along with prices.  Did you also notice that on the 2nd short-range bar (see yellow arrow with the #2), the oscillator below was lower than the previous oscillator high.  And if we are heading south going forward, it will confirm the 3rd short-range bar (see yellow arrow with #3) as the pivot high and the oscillator will head down from here.  On top of that, notice that current oscillator high is lower than the previous oscillator high as well.  This will confirm a solid divergence if prices head south tomorrow.

Again, all this will depend on how price actions end up tomorrow.  If prices head south tomorrow in a intermediate to big way, it may confirm the high of the 3rd oscillator and a repetition of the 3rd retracement.

FWIW, see for yourself in the charts:

Below is the daily SPY chart:

Below is the weekly SPY chart:

Below is monthly SPY chart:

The market will always be around; but you may not be if you don’t protect yourself.  Trade safe and trade with discipline!

Good Hunting!

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