Saturday, November 17, 2007

Weekly Swing Trading Calls -- Nov. 19-23, 2007

On the market -- stalemate, for now!

Bulls were able to significantly slow down the tremendous bears attack and ended week with a slight gain, while bears managed to thwart any serious rebounds.

On the weekly charts, all major indices posted more or less of a spinning top candle formation, indicative of indecision on both parties. Most indicators still favor more down side movement.

On the daily charts, both DOW/SP500 closed below EMA200, while NASDAQ successfully tested and closed above EMA200. The lows on Nov. 12 seem to firming up for all major indices, while downside momentum is diminishing.

On the 30/60 min charts, DIA/SPY/QQQQ all show signs of oversold rebound.

Overall, the bears and bulls are in a temporary stalemate right now. For bears to break through the impasse, relying on the carry-over negative momentum is no longer enough, instead, it will need more significant bad news on the macro-economy level, especially the solid evidences of consumers' faltering spending. For bulls, however, things are a bit easier: as long as there are no significant negative headlines, the favorable seasonability (Turkey rally and Santa Rally) may help them to steadily recover some of the lost ground.

My feeling for the next week is that while it will be a overall range-bound market between the Nov. 12 low and Nov. 14 high, the bias is mildly bullish. Therefore, I will continue the intra-day or very short swing trades from both sides using those key S/R as stop/entry references. Since it will be a non-trending market with high volatility in coming days, taking quick profits is very important.

Weekly Trading Calls:

1. AAPL: short-term rebound on the way!
Weekly: doji candle, still a clear up trend, indicators mostly bullish.
Daily: signs of temporary floor around 160, indicators slightly bearish
30/60 min: solid signs of more over-sold rebound.
** DT/SW L2, entry zone=159-165, IT=175
** DT S3 if it spikes towards 175/180 use tight stops.

2. AKAM: more pullback before rebounding?
Weekly: second losing week on light and diminishing volumes, indicators mildly bullish.
Daily: several successful tests of EMA50, but indicators point to possibly more pullback before rebounding
30/60 min: reluctant oversold rebound, slightly bearish
** DT/SW L2, entry zone=33-34.5, IT=38.

3. BIDU: A falling leader?

Weekly: neutral, second losing week on high volume, noticeably weaker than QQQQ/NASDAQ, repeated bullish calls from analysts could not stop the slide,
Daily: bearish, un-abating negative momentum as every rebound was sold down,
30/60 min: struggling to mount any over-sold rebound, test of Nov. 12 low around 298 is still in the card.
** SW CTT if it spikes towards key S/R levels: 298, 333, 360 use tight stops, don't trade the middle ranges.
** Consider DT/SW S2 if it breaks and closes below 294, IT=270?

4. CRM: Stellar Q report emboldens bull rampage!

Weekly: very bullish all around
Daily: every bullish with extreme bullish candle, there is no way that bulls will be satisfied with anything less than new highs.
30/60 min: bullish and in overbought regions, but if it is indeed trending to new highs, expect overbought to become even more overbought.
** SW L1, entry zone=55-57.1, stop just below 55, IT=65
** DT L1, entry zone=56-57.1, stop just below 56, or when it breaks 57.6, IT=62.

5. DRYS: running into a dry ground?
Weekly: 3rd straight down week on diminishing but still relatively high volumes, indicators favor further down side movement, MACD histogram is poised to become negative for the first time in months.
Daily: persistently high negative momentum kept it near over-sold region,
30/60 min: signs of oversold rebound but lacking strength.
** DT/SW S2 if it spikes toward key resistances around 95, 100, and 105 with tight stops.
** DT/SW L3, entry zone=82-85.11, stop just below 81, IT=92.

6. EXM: trouble water ahead?
Weekly: like DRYS but even weaker as it is on the verge of trend-reversal confirmation, very bearish
Daily: descending candles on persistent negative momentum, is another leg down in a short order?
30/60 min: stuck in oversold with all bearish indicators favor more oversold time.
** DT S1 break-down play if it breaks 43.5, stop just above 44, IT=40.
** SW S2, entry zone=48-52, stop just above 53, IT=44.

7. FSLR: indeed the first of solar!

Weekly: increasing bullish momentum, uptrend to continue
Daily: Friday's action conclude the pullback.
30/60 min: rebound in full swing, overbought conditions does not mean imminent pullback if it is trending up.
** DT L2, entry zone 200-205, IT=230, stop just below 200,
** SW L1, entry zone 185-201, IT=250, stop just below 185.

8. GRMN: have the fundamentals changed for better now?
Weekly: overall still mildly bearish, but will the bullish engulfing candle embolden the bulls?
Daily: diminishing negative momentum, sellers still abundant near key resistances.
30/60 min: poised for overbought pullback.
** CTT at key S/R: around 93.5, 102 and 109, don't trade the mid-region.

9. RIMM: from studs to suds?

Weekly: second weekly loss on increasing volume, indicators favor more down side move, but long shadows on the candle may define the short-term trading range.
Daily: Friday's high volume reversal may have lay down a short-term bottom, but un-abating negative momentum may cap any significant rebound.
30/60 min: over-sold rebound is running its course
** SW/DT S2 if it spikes towards 118, stop just above 120, IT=105

10. TBSI: the reverse of a fortune?

Weekly: 4th straight weekly loss with acceleration to the down side, extreme Marubozu candle along with other indicators point to further loss.
Daily: oversold becomes more oversold as it clearly trends down
30/60 min: clearly down-trend suppressed any over-sold rebound.
** DT/SW S1 if it spikes towards key resistance around 47, 52 and 58.
** DT/SW speculative L3 if it spikes down towards 35, with stop just below 34.5, IT=45.

Saturday, November 10, 2007

Weekly Trading Calls -- Nov. 12-16, 2007

On the Market:

For the first time in nearly three months, bears took solid control and pounded bulls to the submission. Another round of confession by financial heavyweights pushed the major indices through the key support levels early in the week which emboldened the bears to launch an all-out attack on the tech bulls who quickly entered a panic retreat mode. For the week, all major indices suffered huge loss with NASDAQ led way for a 6.5% drop.

On the weekly charts, the bearish-engulfing Marubozu candle of Oct. 14 week finally got a big follow-through, especially in NASDAQ which posted an ominous evening star formation. The momentum is now solidly on the negative side and on the rise for both SP500 and DOW. The bearish candle formations and many other indicators clearly point out the likely further downside movement in the coming days.

On the daily charts, things are even more bearish as both SP500/DOW closed below MA200 while NASDAQ firmly below EMA50. Even though the 3-day sell-off pushed all indicies near oversold region, the high volumes and increasing negative momentum suggest more losses on the way. As the major indices seem to on its way to test their early Aug. lows, there are some key support levels that are critical to bulls: NASDAQ-2490 to 2520, around 2580; SP500-around 1450 and 1430; DOW-around 13000 and 12850.

The big question right now is if the current huge decline is a repeat of the late July/early Aug epic. and thus represents a perfect buy-on-dip opportunity for the ever so trustful Santa rally OR this is the beginning of the end of the multi-year up trend? The problem for the bearish case is that as long as the major indices succeed the test of previous low, bulls are far from done. The problem for the bullish case is that it was Fed's rate cuts stop carnage and drove market higher in Aug. now with the Fed already cut twice without a lot of room to go further, what factors are going to halt and reverse the powerful free-fall? Right now, I am leaning to the bearish case but I will keep an open mind. I don't expect a lot of subprime headlines next week as the financial stocks show signs of stabilization, and I will pay close attention to retail sale data and find out if retail sector can rebound a bit here.

On the Trading:

After several key mental mistakes that burnt big holes in my account, I finally came to face the reality and did something I should've done several years ago by implementing an external supervision mechanism that is aimed to stop any train-wreck acts in track. Things are working fine so far as I posted a 20% again for the week. However, I still need to be more realistic about the profit expectation and more awareness and control in risks. For the next few weeks, I will set a daily target of 1% gain, and weekly at 6%.

Given the current market conditions, I will try to avoid swing long trades while actively look for swing short setups. I will continue to focus on day-trading from both side and take advantage of the volatility.

Weekly Trading Calls:

1. AAPL: bears took out their multi-month frustration on bulls the big way. Weekly has a evening star candle formation with other indicators turning bearish, but it is still a clear uptrend stock. Daily seems to form a towering-top formation, closed weekly right at the EMA50, but with all the things running for bears, further slide is likely; 30/60 min charts bearish but in oversold area.
** DT-S1 if it approaches key resistances at 168, 174/175 or 179/180 with a stop just above those levels.
** DT-L2 if it spikes towards 153 with a stop just below.
** SW-L1, entry zone=145-149, stop just below 145, IT=153.

2. AKAM: Low volume and mild retreat in the midst of tech melt-down. Weekly: trend-reversal still intact; Daily: first test of EMA50 was successful but it may drop more if NASDAQ accelerates to the downside.
** SW-L1, entry zone=32-33.11, IDS just below 31.7, CS just below 33, IT=40.

3. AMZN: Weekly: the risking negative momentum is on the verge of confirming a trend reversal; Daily: Friday's broke-down spells more losses for bulls; 30/60 min chart: bearish but in oversold area.
** DT/SW S1 on top if it spikes towards 83/84 with a stop just above 84;
** DT L2 if it spikes towards 70/71 with a stop just below 70,

4. BIDU (focus stock): the unrelenting bulls along with momo traders got crushed. Weekly: still a clear up trend but the bearish engulfing candle is ominous for bulls; Daily: more bearish with negative momentum on the rise; 30/60 min: bearish with signs of stabilization.
** DT-S2 if it spikes towards 360 with a stop just above, IT=330.
** SW-S1 if it spikes towards 400 with a stop just above 410, IT=360
** DT-L2 if it spikes towards 300, 315, 324 use tight stops.

5. CROX: Weekly: bearish with negative momentum on the rise; Daily: bearish, oversold and Friday's action show signs of temporary bottom; 30/60 min: mildly bullish
** DT-L2 if it spikes towards 35 with a stop just below 34.8, IT=40
** DT-S1 if it spikes towards 44 with a stop just above, IT=40,
** SW-S1 if it spikes towards 46/47 with a stop just above 48, IT=40.

6. CTRP: earning report drove it to new high. Weekly: bullish all around; Daily: bullish.
** DT L1 if it spikes towards 55.55 with a tight stop, IT=59
** DT L1 if it spikes towards 54 with a stop just below, IT=56
** SW L1 if it spikes towards 51, stop just below 50, IT=54.

7. DHI: bearish all around, BUT bullish divergences developing on both daily/weekly charts; 30/60 min in overbought region. Is it time to buy the bottom here?
** SW speculative L3, entry zone=11.41-11.81, IDS just below 11, IT=13.4

8. DRYS (focus stock, currently long near 98 during the closing moment on Friday):
Stellar earning report failed to buoyant the stock in a sea of red. Weekly: diminishing up momentum with indicators favor more down side move; Daily: closed below MA50 for the first time since Aug, negative momentum on the rise, but candle formations and volumes in the last two sessions show signs of stabilization; 30/60 min: in oversold region with signs of rebounding and temporary bottom at 95. I closely watched level II and tape last Friday, and there were signs of big boys buying at the current level; it would have closed above 99 had market not sold off that hard in the last 30 min, and bulls should take into comfort that even with such sell-off it closed above its open. I suspect that it will rebound as long as the BDI indice continues to hold/rise from the current level. I shorted it on the closing moments on the Friday before, resulting in a 7+ points gain, and now looking for a sizable gain from the long side.
** For the holding position: stop if breaks 95, if it fails to break 100 on Monday, consider exit at least half of the position, if it breaks 100, it will be almost certain to test 105 if not 108.
** DT S2 if it spikes towards 105, 108, 112, and 120 with tight stops.
** DT S3 if it breaks 95, but must take quick profit, IT=92, stop just above 96.
** DT L3 if it spikes towards 90, with a stop just below, IT=95.

9. GOOG: even strongest bulls cannot withstand the furor of the long frustrated bears. Weekly: clearly up trend but a bearish-engulfing candle on all-time high volume could spell more pullback; Daily: bearish with increasing negative momentum;
** DT L2 if it spikes towards 640, stop just below 636, IT=660
** SW L2,entry zone=600-611, stop just below 600, IT=660.

10. GRMN: even the best GPS failed to navigate it out of a sea of trouble. Weekly: just confirmed the trend reversal, increasing negative momentum points to more loss; Daily: bearish and oversold, stabilized at EMA200,
** DT SW S1 if it spikes towards 95 with a tight stop, IT=83 for SW, 93 for DT.

11. ILMN: Weekly: diminishing up momentum but still clear up trend; Daily: neutral is bullish considering the market conditions.
** DT L1 if it spikes towards 51, stop just below, IT=55
** SW L1, entry zone=46-49.1, IT=55, CS just below 46.

12. ISRG: No bulls can escape bears wrath! Weekly: 2nd down week in a roll, still a very clear bullish case; Daily: increasing negative momentum spells more decline if the major indices fall further.
** SW L1, entry zone 265-271, stop just below 265, IT=300.

13. PFCB: bullish divergence on daily chart plus the modest inside buys stopped bleeding for now, is it time to load it up?
** SW speculative L3, entry zone 27-28, stop just below 27, IT=30.

14. RIMM: see comments on GOOG and AAPL.
** DT L1 if it spikes towards 100 or 106 with tight stops., IT=115.
** SW L1, entry zone 93-95, IT=118

15. SOHU: the post-earning euphoria drown in the red sea. Weekly: bearish-engulfing candle but everything else still bullish; Daily: parabolic bull run squashed by bears but on lighter volumes.
** DT L1 if it spikes towards 50, stop just below, IT=57.
** SW-L1, entry zone=45-46.11, IT=57,

16. SONS: the better than expected earning report powered it up in a falling world. Weekly: trend-reversal confirmed with increasing bullish momentum; mildly bullish but diminishing up momentum; 30/60 min: in overbought region and signs of pullback.
** DT SW L1, entry zone=7-7.21, stop just below 7 for DT, IT=8

17. VMW: the momo traders are no match for pissed-off bears. and I am still pissed off that Ameritrade did not have any shares for short when I was frantically trying it as it was breaking 105, and they still don't have any now. Anyone who has better experiences with different brokerage? Weekly: you cannot get a better morning star formation than this one; Daily: a free-fall with increasing negative momentum.
** DT-S1 if it spikes towards 103, stop just above 105, IT=96,
** SW-S1, entry zone=104-109,stop just above 110, IT=96

18. WFMI: Weekly: momentum turning bearish, huge bearish candle; Daily: broken down below both EMA50/200, negative momentum on the rise.
** DT SW S1 if it spikes towards 46, stop just above, IT=44.5
** SW S1, entry zone 45.8-47, stop just above 47, IT=42
** DT L1 if it spikes towards 40, stop just below, IT=42.

19. WLT:
that good earning report sure has a staying power. Weekly: bullish on increasing momentum; Daily: bullish, a bit overbought, but bulls not backing down.
** SW L1, entry zone=32.5-33.11, stop just below 32, IT=40
** DT L1 if it spikes towards 35, stop just below 34.6, IT=36.

Earning Watch:

1. SINA: report 11/14 AH, will it enjoy a post-earning run like SOHU? overall bullish trend, looking for small entry near 47 before earning. Key level: 42, around 46-47,around 50.2, 55-56, 59.

2. STP: report 11/15 BMO, will it have a report like FSLR? Key levels: around 44,48, 54.8, 62, 75.64.

Saturday, November 03, 2007

Trading Calls-- Nov. 5-9, 2007

On the market:

The market got its rate cut wish and promptly rallied on Weds, but a steep and high volume sell-off pained a less bullish picture for the coming days. Significant divergences among major indices emerged last week as both DOW and SP500 losing over 1.5% while NASDAQ made slight gain. The divergence can be attributed by new concerns in financial sector and continuous strength in tech sector.

On the weekly charts, both DOW and SP500 show the bearish impact of the bearish-engulfing Marubozu candle of Oct. 14 week with signs of more follow-through; the NASDAQ is still very bullish with increasing momentum.

On the daily charts, the bearish-engulfing Marubozu candle resulting from the post rate-cut sell-off significantly dampened the hope that both DOW and SP500 would join NASDAQ in making new highs, furthermore, as DOW/SP500 closed below their EMA50, it seems that they are poised to make a lower low there after making the lower high this week. The rebound on the Friday clearly shows that key support is very much there for both DOW (around 13400) and SP500 (around 1490), and until these supports are broken through, with NASDAQ's strength, the major indices may attempt another rally for new highs.

With rate-cut done and earning reports slowing down, the market is probably going to focus on the financial sector and the health conditions of consumer spending in the coming weeks. Unless the NASDAQ start to come down and DOW/SP500 break the key support levels, the battle between bulls and bears will intensify in the coming days. With that in mind, the best trading strategy right now is probably to open to both long and short trades using key S/R as entry/stop references, and be nimble to take profits, and try to shorten the holding time.

Trading calls

1. AKAM: weekly and daily bullish, 30/60 min neutrual
** DT/SW L1, entry zone=34.5-35.5, CS just below 35, IDS just below 34, IT=40.

2. AKS: weekly posted first real bearish engulfing candle in over a year period, with many indicators point to further downside; daily all bearish; 30/60 min all bearish but with signs of stablization.
** DT/SW S2 on rebound, entry zone=49.9-51.9, stop just above 52, IT=42

3. AMZN: weekly on the verge of confirming the reversal of the long up trend; also bearish in all other time frames.
** SW S1 on rebound, entry zone=89-92, stop just above 92, IT=83.5
** DT S1 if it breaks key support just above 83, IT=79/80.

4. CROX: the post-earning plunge marked the reversal of the fortune for this stock. Bearish all around, but near-term bottom around 44 seems tentative.
** DT S1 on rebound it it stays below 50
** DT L2 if it breaks 50, but be nimble at profit-taking
** SW S1, entry zone 53.8-55, stop just above 56, IT=47.

5. DRYS (focus stock, currently shorted near 113 during the closing moment on Friday):
weekly still bullish but many indicators show developing bearish divergences; daily has several high volume sell-off caused extreme bearish candles seem to confirm the short-term top around 130, downside momentum on the rise and was the first since it Sept break-out; 30/60 min bearish but in over-sold position. Technically, the stock is at a crucial point here, a break of 110 level will almost guaranteed a test of recent lows between 103.46 and 107.75. However, I tend to believe that its first test of EMA50 (currently at 98.6) will be successful.
** for the holding position, CS just above 117, IDS just above 119.5. But I will consider exit the position early during the Monday session if it fails to at least break the 112.5 low for the last two sessions. Will take partial profit if it breaks 110 and spikes down towards 108, and may completely exit if it spikes towards 103, and possible reverse the position near EMA50 with a small initial entry and tight stop.
** DT S2 on rebound, entry zone=117-119, stop just above 120; IT=113
** SW S2 on rebound, entry zone=126-129 stop just above 131.5, IT=113

6. GRMN: the post-earning plunge may mark the reversal of the long up-trend. Weekly chart is confirming the trend reversal; daily also bearish with increasing negative momentum; 30/60 min point to rebound from the oversold area.
** DT/SW S1 on rebound if it spikes toward key resistances around 102/103, around 105, and around 109/110.
** DT S1 if it breaks the key support near 95, IT around 92?

7. SLB: weekly is confirming at least the temporary reversal of the up trend with increasing negative momentum; daily also bearish but shows firming of the short-term bottom near 95; 30/60 min mildly bullish but in overbought region.
** Speculative S3 if it spikes towards 102 or 107 with stops just above, IT=92.

8. SNDK: weekly bearish but negative momentum stalled and some indicators point to more rebound; daily suggests more rebound on the way; 30/60 min all suggest further rebound.
** DT/SW S1 if it spikes towards 47/48, with stop just above 48, IT around 42.

9. TIF: the bad news on the wall street translate into less lavish bonus fuled holiday buying binge at its main store in NYC? Weekly chart on the verge of confirming the trend reversal, bearish indicators point to further downside; daily more bearish with increasing negative momentum.
** DT/SW S1 on rebound, entry zone=51-53, IDS just above 53.5, CS just above 51 with a bullish candle., IT around 47.

10. UA: the post-earning rebound could not be sustained. Weekly show confirmed down trend with increasing negative momentum; daily also bearish, but 30/60 min in oversold region.
** DT/SW S1 on rebound, entry zone=58-61, CS above 61, IDS above 62, IT=53.

11. WLT: the post-earning rally propels it to new high and screaming bullishness.
** DT SW L1 if it spikes towards 32.5/33 use 32 as stop.

Eyes on the shipping sector:

1. TBSI: very much like DRYS; earning report on Nov9? A break-down through 58.5 may drive it to test 51.
** DT SW S2 on rebound, entry zone=62-63.5, IDS just above 64, CS just above 63, IT=58.

2. EXM: very much like both DRYS and TBSI; if it breaks down 63.1, it will test 60.

3. DSX: much stronger than other player in the sector...

Next Weekly earning plays:

1. CTRP: Nov 7, AMC, bullish everywhere and making new highs. It has always been a textbook buying on dip play, will this time be different?
KEY Support: around 45, 48, 51, 54,

2. SONS: Nov 8 AMC. Last Q was a disaster, but it has been on recovery, will this Q report support a perfect cup-n-handle formation?
Key S/R: 5.5, 6, 6.5, 7, 7.2-7.5, 8, 8.5

3. NVDA: Nov. 8. arguably the strongest in the dismal semi sector, it always delivers on the earnings, will this time be different?
KEY S/R: 30/31, around 32.5, around 33, around 36, 39.67 (high)