Swing Trade Calls -- Oct. 6, 2007

On the market

Wow! Friday's big rally has all major indices breaking out solidly. The market has taken any news as good news, and with the low rates and suddenly not bad job market, Can you get any more bullish than this? Bears really don't have much going for them, maybe except that the market has been extended without pullback and that the volumes have been relatively light in the past few weeks. Judging from the weekly charts, it seems that the bullish momentum has just started for the major indices, which can easily translate into at least 4-6 bull run. Given all what's going on right now, I doubt that Q3 report season will rain on bulls parade, unless the Q4 outlook makes a sharp down turn, we shall see.

On the trading strategy:

There is no doubt that the best overall trading strategy right now is swing longs, but patience should be exercised and use daily stochastic and key support level to setup the positions. Swing short might be considered for some retailers as their weekly charts are still bearish and that I suspect that the upcoming holiday shopping season will not be a good one. Day-trading, especially on the long side, is also a sound one, but strict stop-loss and opening signals must be honored. In addition, as the Q3 report season kicks in next week, I am looking forward to trade the post-Q-report based on a special set of set-ups.

Trading Calls:

1. ANF: it is one of the strongest retailer here, and the weekly chart favors long side. However, it made new intra-day highs in the past two sessions, only to fail quite dramatically each time.
** Speculative swing short with small initial size, entry zone=84.88-85.77, stop just above 86; IT=79.
** DT-S2 can be considered, but must have close to key resistance around 85 with very tight stop, IT=82.

2. ANN: rebounded strongly in the past few weeks and now at a critical point as it is approaching EMA200=35.05. Bullish on both daily and weekly charts, but bearish on both 30/60 min charts.
** DT-S1 if it spikes towards 34.7 with a stop just above 35, IT=33.5
** Swing-S2, entry zone=35.8-36.5, stop just above 37, IT=33.

3. ARO: Swing-S2 if it spikes towards 24, stop just above 24.5, IT=21.

4. AKS: bullish on weekly chart, but daily, 30/60 min charts show short-term bearishness.
** DT-S2 with possible holding up to 3 days: entry zone=43-44, stop just above 44.5, IT=40.

5. EBAY: still bullish on weekly chart, but daily/30/60 min charts show short-term weakness.
** DT-S2 with possible holding up to 3 days: entry zone 38.9-39.3, stop just above 39.4, IT=37.

6. GRMN: conflicting signals at different time frames, day-trading only using key S/R: 95.25, 97, 100, 102.6, 109 as stop references; take quick profits as it will remain very volatile until the prevailing signal established.

7. ILMN: heart-breaking as I finally entered at 54 on Oct. 4, only to wuss out for a tiny profit moments later. L1, entry zone=54-55.5, stop just below 53.

8. JCG: CTT between 41 and 46.4 using very tight stops, don't trade the mid-range. Still a clear-cut down trend play, but be patient.

9. LDK: the fear is still there, with Barron's negative article coming out this weekend, it might spike down further, I am looking for a speculative L3 between 33-37, stop just below 30, IT=58; be patient and conservative, and no day-trading!

10. NUE: weekly just turning bullish, but daily/30/60 min charts show short term weakness.
** DT-S2 when it spikes towards key R at 59 and 61, use very tight stops, IT=56.

11. SHLD: weekly chart offers the first sign of reversal of a long-hard down trend, and more bullishness on daily chart.
** DT-Long when it approaches key S at 140 and 146 with tight stops.
** DT-short if it spikes towards key S around 155, 167, 170, 174
** Swing short zone 169-174, with a stop just above 175, IT=150.

12. SNDK: it has been inexplicably weak lately. Weekly chart just showed a trend-reversal signal.
** DT S1 with it spikes towards key R around 53.1-53.5, 54.5, and 56,
** Swing S1, entry zone 53-56, stop just above 56, IT=50

13. STP: conflicting signals at different time frames with mild bullish on weekly chart, and mild bearish on daily or shorter time frame charts. pay more attention to key S/R , and be quick to take profits. Barron's article this weekend may setup Monday's wild swing.
** DT-L2 if it spikes towards 37 use a tight stop, IT=EMA50=38.5.
** DT-S2 if it breaks 39.5, stop just above 40, IT=38.5, quick with profit.

14. TIF: it is on the verge of testing high around 56.8, weekly chart very bullish, daily chart also bullish, but it rose nearly 40% in 5 weeks, and with volume and momentum show slight bearish divergence, and the fact that it is in retail sector, it might be poised to pullback even if it sets new high.
** DT to overnight only, S3 if intra-day show clear bearish signal.

15. UA: both weekly/daily chart bearish, but 30/60 min charts suggest some rebound.
DT/Swing S1 if it spikes to key R at 60, 60.6/61, stop just above 61.5., IT=57