Traders Corner   13 comments

I added SPXU in the pre-market at $18.44, with a plan to sell it for $18.95 or best price available later today. The technicals just don’t show much upward room for movement:

1. The McClellan Oscillator is overbought at 61.
2. The S&P 500 closed (1744) above the top of the Bollinger Bands (1737) on Friday.
3. The Williams %R finished Friday overbought for the third day. With the absolute low on Williams at 0, it finished at -0.82.

While any of these three indicators could be wrong by themselves, combined they show a strong probability towards a bearish move today, in spite of the futures being flat this morning. At the very least, I would expect a flat day on the markets, in which case SPXU will be a wash. I may add more SPXU if we get a pop this morning.

The S&P 500 levels to watch today:

UPSIDE: 1745 (October 18th’s high and the all-time high).
LAST CLOSE: 1744.
DOWNSIDE: 1737 (top of the Bollinger Bands), 1735 (October 18th’s low), 1733 (October 17th’s high), 1729 (September’s high), 1721 (October 16th’s high), 1714 (October 17th’s low), 1711 (2 data points), 1709 (August’s high), 1703 (October 11th’s high), 1700 (October 16th’s low), 1698 (July’s high), 1691-1696 (7 data points and the 20 day moving average), 1687-1688 (2 data points and May’s high), 1680-1682 (2 data points and the 50 day moving average), 1676 (October 8th’s high), 1674 (October 7th’s low), 1670 (October 3rd’s low), 1662 (October 9th’s high), 1660 (October 10th’s low), 1654-1655 (October 8th’s low and June’s high), 1653 (bottom of the Bollinger Bands), and 1646 (October 9th’s low).

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Posted October 21, 2013 by edmcgon in Daytrading, Investing, Market Analysis, Portfolio Moves

13 responses to “Traders Corner

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  1. Ed, since you occasionally get dinged on the reverse, I applaud your use of qualifying language while making your guesses/predictions. I think saying things like, “combined they show a strong probability” versus stating things as “going to happen” give you more credibility.

    • John,
      Actually, I do use that for more than just being politically correct. If McClellan was at 80 or higher, along with the other indicators being at their present places, I’d “go all in” with my language. At 61, it just creates a high probability.

  2. Marshall, Your GTAT is on fire, currently up 8%.

    • Thanks Lynn. I have been thrilled with my GTAT gains. I really sold vjet too early. It has gone from the 24 I sold it at on Friday to $36 dollars today! I hope someone else out here bought and held it.

    • Marshall, Is KLIC still a good buy at this price?

      • Lynn,

        Barron’s placed a price target of about $18 on KLIC. So at a bit over $13 it looks pretty reasonable to me. The overhang is that they have so much cash, people have to worry that they will do something foolish with that cash. But if they signal they will return to shareholders, buy back stock or make an accretive buy, the stock could move up nicely.

      • Thanks Marshall, will pick some up sometimes today.

  3. Ed, wondering why you buy in the premarket when you are looking to daytrade? There are usually entry points with less risk when you can see the intraday technicals.

    • Trader,
      The pre-market price was pretty close to Friday’s close. Worst case scenario would be the market flattens and I lose a few cents on the deal. Also, I’m not playing it minute-by-minute. Even though I am technically “daytrading”, I am playing it more for the whole day, although I may hop out of the trade early if I like what I see, or I start to feel uncomfortable with the market’s movements (i.e. if I am sitting on a nice profit and I don’t want to risk the market going from down to flat). Finally, what Jon said below is pretty accurate too, as there are times I may get called into a meeting during the day, so I don’t have time to babysit the holding, so I have to be comfortable with what I expect the final results of the day will be.

  4. My guess is Ed has to go to work so the opportunity to do so during day is limited

  5. I’m looking to harvest some 2013 losses to offset some gains. Opinions on JRCC or NUGT for this purpose? On the surface, JRCC would seem to have the greater downside (bankrupty).

  6. I sold SPXU after the close for $18.40, and a 0.22% loss. I don’t want to carry it overnight.

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