Saturday, February 24, 2007

Weekly Trading Calls -- Feb. 26 -- Mar. 2, 2007

Bulls tried to pull another re-run on the Friday just like they did on both Weds and Thurs, but bears managed to hold on to the fragile victory till the closing bell. Will bears be embolden by this and kick up a notch next week?

Some basic fact about the major indices:

  • On the weekly charts, the up trend remain not only intact, but it is unchallenged.
  • The up side momentum virtually diminished for all 3 indices, which may forecast the ending of straight-up movement and the arrival of side-way stage.
  • Bearish divergences exist for several technical indicators for all the indices on the week charts.
  • NASDAQ is the only winner of the major indices. If it continues its winning way next week, it may pull the market higher, but if it reverses in a hard way, with both SP500 and DOW already show some weakness, that would wake up a lot of bears.

My overall strategy for next week:

  • long on the pullbacks of strong up-trending stocks, but don't buy the break-out.
  • too early to short any stocks that are still making new highs so don't do it!!
  • consider small speculative short positions on stocks approaching their recent high, but be ready to stop out the they have strong break-outs.
  • except the small speculative short positions, be nimble to take profits, and be very cautious about the overnight positions.

Weekly Trading Calls:

1. AAPL: S2 on top if it spikes towards 93 with a stop just above; L2 only when it spikes towards 86.5 use EMA50=86.2 as stop references. Try not trade the mid range.

2. ADI: L1 on pullbacks, entry zone 36-36.6, stop just below 36, IT=38-39.5.

3. ADSK: Speculative S2 on top if it approaches 43/45, with a stop just above 45.2, IT=41, but it if it breaks through 40, it would be big.

4. AMD: remains extremely oversold, and now backs to the level of 2 years ago when the rally started. Weekly candles suggest bearishness may be topped out, but many other indicators point to further momentum decline. I see a fundamental support zone between 10.5 to 13.6, and IT zone between 17-18.5 for short-term rally if that occurs, need to be patient here for a possible SW-long entry.

5. AMZN: speculative SW-S2 on top if it approaches 42, stop just above 43.3, IT=48.

6. ANF: SW-S3 on top, entry zone 80.8-83, stop just above 83, IT=EMA50=77.6.

7. ANN: SW-S3 on top, entry zone 35.7-36, stop just above 36.3, IT=33.5.

8. BIDU: Speculative S3 on top when it spikes towards 112/115, use very tight stops. EMA50=114.8.

9. BOBJ: Speculative SW-S3 on top when it spikes towards 38, or S1 when it breaks 36, IT=33.5. EMA50=38.1, EMA10=38.4.

10. BRCM: speculative SW-S3 on top around 37, stop just above 37.5, IT=MA50=33.1. Very good RSW/RWD ratio, but probability is not very good.

11. CRM: speculative SW-S3 on top if it approaches 50, stop just above 50.5, IT=44.

12. DVN: SW-L2 on bottom if it spikes towards 65 with a stop just below, IT=68.5.

13. ENER: SW-S3 on top if it spikes towards 33, use EMA50=33.6 as stop reference, IT=30.

14. ERTS: CTT between 31.5 (MA50) and 54.5 use very tight stops, don't trade the mid range.

15. ESRX: speculative SW-S3 on top, entry range 78.5-79.5, stop just above 80, IT=75.

16. FFIV: speculative SW-S3 on top, entry range=78.5-80.5, stop just above 81, IT=EMA50=73.7.

17. FNM: CTT-S2 on top, entry zone=59-60, stop just above 60.3, IT=56.

18. MDT: S1 on top if it spikes towards 52, with stop zone=52.6-53(EMA50), IT=49.

19. MRVL: will report Q4 on Monday AMC, watch key resistance zone 21-22, and support around 18, consider a long position if there is a solid break above 22 after the report, next resistance zone=26-27.

20. NTAP: it may break-out if NASDAQ breaks out next week. May consider a speculative long if it spikes towards 39.5, IDS just below 39 and CS=39.4, IT=41.5?

21. NTES: will report Q4 on Monday AMC, keep eyes on key support around 19 and resistance around 23.

22. NUE: CTT between 61 and 66/67 use tight stops, bias slightly bearish, don't trade the mid range.

23. NVDA: SW-S2 on top, entry zone 33-34, stop just above 35, IT=30, EMA50=33.5.

24. SNDK: looks like testing 1 yr low at 37.34 is inevitable, triple MACD histogram divergence on both daily and weekly charts, but is it time to catch this falling knife?

25. SONS: will report Q4 on Feb. 28 AMC, keep eye on the key support around 7 and resistance near 8. I feel that the current share price already reflect a stellar report, therefore I may consider a small speculative short position just below 7.8 going into the earning.....

26. WFMI: speculative SW-S3 on top if it spikes towards 52 with a stop just above 52.5, IT=47. I feel that it has a good chance to fill the gap.

27. WLT: SW-S2 on top if it spikes towards EMA50=25.8 with a stop just above 26, IT=22.

28. X: DT-L2 on bottom if it spikes towards support zone 87-90, RSK/RWD not attractive.

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