Traders Corner   27 comments

I may have overstayed my welcome on SPXU today. The S&P 500 futures are up this morning, plus the daily Williams %R is now oversold (-82, with -80 being oversold). On top of those, the McClellan Oscillator is now at -45, getting close to oversold at -60.

However, the weekly RSI just dropped out of overbought territory, at 67, with overbought at 70. However, a pop today could easily push the RSI back into overbought for the week, which would bode poorly for next week, especially with the weekly Williams %R still in overbought territory.

The key might be today’s monthly U.S. Employment Report, coming out at 8:30 am EST. As usual in this QE-inspired upside-down world, a good report could be bad for markets, and vice versa. The Bloomberg consensus estimate is for non-farm payrolls to rise by 180,000 jobs, in a range of estimates from 140,000 to 200,000.

The S&P 500 levels to watch today:

UPSIDE: 1787 (December 3rd’s low), 1789 (20 day moving average), 1792 (December 5th’s high), 1794-1803 (13 data points), 1810 (December 2nd’s high), 1813 (November’s high and the all-time high), and 1819 (top of the Bollinger Bands).
LAST CLOSE: 1785.
DOWNSIDE: 1783 (December 5th’s low), 1779 (December 4th’s low), 1775 (October’s high), 1758 (bottom of the Bollinger Bands), and 1749 (50 day moving average).

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27 responses to “Traders Corner

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  1. I doubled my SPXU at $16.62 in the pre-market, lowering my dollar cost average to $16.68. I will sell the entire position today at $17.63, or best price available later today.

  2. Ed – I gotta say the SPXU and UPRO stuff feels like pure speculation. I do not have the stomach for watching every tick and deciding when to buy or sell. Don’t you enjoy the investments in YHOO, GOOG, GNW etc more? Why try to play both sides?

    • Marshall,
      Good question. I do enjoy the other positions more. But when you have large cash positions that aren’t making money, daytrading is all there is. If I can pull in a 1% profit from my daytrades, that’s a good use of my cash.

  3. I added 50% to my SPXU position at $16.44, lowering my dollar cost average to $16.60. The previous sell point at $17.63 will remain in effect for the entire position, or I may sell it for less later today.

  4. I’m going to sit tight and wait for direction. 1 idea is I may ride upro up not sure yet.

  5. This market is very confusing to me. Market definitely seems way overbought to me and I’m concerned about the Fed meeting on the 18th.

    I intend to increase my cash position today. I’m shooting for 50% cash (currently about 36%) by the end of next week.

    • What amuses me is that good news has been bad and bad has been good. What happens when the employment numbers come in higher than they should have which you think should be good? The market goes up. Now bad news is good and good news is good too. What was it that Buffett said about being fearful when others are greedy…

    • Thanks for doing a better job of making my point. My main concern has been the record levels of the market. At a minimum, there has to be a meaningful pull back at some point and the longer we go without one the more likely that pullback will be significant, or perhaps greater than 10%. There is a lot of new driven risk as well. Don’t get me wrong, as long as the Fed continues their shuffling of Fed Debt the markets will continue to go up. I just want to have some cash available to take advantage of any correction.

  6. Ed, not sure why you insist in buying your daytrades in the premarket. Why not wait until the market opens? I’ve never found any advantage to the premarket. I think you increase your risk since you don’t have the advantage of looking at the intraday technicals.

  7. Bought more GTAT (17% add) today at 8.44.

    • Joined u at 8.62, bought in a little too early this morning.

    • Follow up thoughts on my GTAT purchase. What I’m seeing now is technical weakness on daily and weekly charts. Options I sold for $1 are now about $.70. I’m going to sit tight and see what next week brings. What I want to see is a change in the daily for sure and something lining up on the weekly before selling the options. By the time the weekly shows strength, the daily will have turned and option prices with it. Once I sell the options, I will await another time to sell them again.

  8. For TC holders:

    Thompson Creek -2.3% after TD points out solvency issue
    Wed, Dec 4 · TC

    Thompson Creek Metals (TC -2.3%) appears to be running out of cash, TD Securities warns, pointing to TC’s highly leveraged balance sheet and its unsustainable molybdenum operations at current metal prices.
    TC’s long-term solvency is a “major issue” whatever the outcome of the Mt. Milligan ramp-up, the firm says; with a bad ramp-up and even lower metal prices, TC could be pressured to refinance next year.
    The firm maintains its Reduce rating and $0.50 price target.

    • Sorry wrong TC post:

      Thompson Creek balance sheet worries are overdone, RBC says
      10:33 AM ET · TC

      Solvency concerns have helped push Thompson Creek (TC +1.4%) shares more than 20% lower in recent days, but RBC Capital is telling clients the concerns are overblown.
      RBC’s analysis suggests TC will not run into liquidity problems unless copper prices fall below $2.50/lb. and the ramp-up at the Mt. Milligan project is much more difficult than expected and takes longer than 15 months.
      The firm maintains its Sector Perform rating and $3.50 price target on the stock.
      Comments(0)

    • I have a sell on TC at 2.33. If it hits today, and it looks like it very well could, I will shift back into TC-PT. I like the tmeds better than the stock but like Marshall, I wanted the liquidity of TC to take advantage of the oversold condition.

  9. I’m not seeing any up side yet but looks like volatility is back. Guess it’s time to stock my fridge with some beer! My panthers have a big game Sunday night. Go panthers!
    Trader, we were skiing in 0 temps and my friend was to hot 🙂 So at -20 isn’t that where cars start to have problems?

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