Traders Corner   26 comments

Today, I will make a guaranty: The markets will either drop or be flat over the next day or two. If you see the S&P 500 go up a large amount, say to challenge the all-time high at 1850, then short it. Even if the S&P finishes the day there, it will drop tomorrow.

The McClellan Oscillator is in overbought territory at 64. This increases the likelihood of more NYSE stocks declining than advancing. While this doesn’t guaranty a drop, it definitely puts a damper on upside movements. On top of this, the daily and weekly Williams %R are both overbought, while the daily and weekly RSI are both nearing overbought territory.

The S&P 500 levels to watch today:

UPSIDE: 1841 (February 14th’s high), 1849-1850 (January’s high, December’s high and the all-time high), and 1862 (top of the Bollinger Bands).
LAST CLOSE: 1838.
DOWNSIDE: 1830 (February 13th’s high), 1825-1826 (2 data points), 1823 (February 11th’s high), 1815 (February 12th’s low), 1811 (50 day moving average), 1809 (February 13th’s low), 1798-1800 (3 data points and the 20 day moving average), 1791 (February 10th’s low), 1784 (February 3rd’s high), 1778 (100 day moving average), 1774-1776 (2 data points and October’s high), 1770 (January’s low), 1767 (December’s low), 1758 (February 4th’s high), 1755 (February 5th’s high), 1752 (February 6th’s low), 1746 (November’s low), 1745 (150 day moving average), 1743 (February 4th’s low), 1737 (bottom of the Bollinger Bands), 1739 (February 3rd’s low), 1737 (February 5th’s low), 1729 (September’s high), and 1717 (200 day moving average).

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Posted February 18, 2014 by edmcgon in Daytrading, Investing, Market Analysis, Technical Analysis

26 responses to “Traders Corner

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  1. I added SPXU at $60.10 in the pre-market. I will sell it at $60.76 or best price later today. I might carry it into tomorrow, but I would rather not.

    Note that I am treating this separately from my existing SPXU position.

    • I don’t see weakness in the S&P yet. May have a better idea at the end of the day. Again, have to question why you keep buying in the pre-market? Seems like you always pay more.

      • Trader,
        Speaking for today, I had a meeting at 9 am, so I wasn’t going to be available for the market open. Since the futures were flat when I bought, it seemed a good deal to get it for less than Friday’s close.

        Also, if I like where the pre-market is trading, I will take it. I have seen more than a few times when the pre-market price saved me.

  2. I put in three buy orders as I need to reconfigure my dividend portfolio post sale of CSCO. These are not meant to be sexy stocks, but rather steady eddie stocks that will create decent income stream. I am buying FSC, RAI and DPG.

    • Marshall,
      I like the first two. I’d have to look into DPG a little more before commenting.

    • Marshall, how do you sell DPG without driving the price down? The daily volume isn’t exactly high.

      • Wow – all you guys are quick on the draw. I just checked, and none of my three orders have filled. I did not put in “puke” prices, but did low ball a bit. I was a bit surprised at everyone’s comments on DPG. It trades 44,000 shares a day. I think I can buy it without moving the market too much (TC-PT is much lighter volume). I no longer own CIM – that was a stock I definitely sold too early. All three of these buys are hold for at least a year and collect the dividends, which should minimize their volatility. Finally, I hope some people help on to their GTAT. It is up a buck today.

      • GTAT still looks strong. I wouldn’t buy today. I’ll watch the price action on pullbacks. If it continues to show strength I’ll buy again. I have one position with covered calls that will expire this week.

      • well, you guys talked me out of RAI and DPG. I just bought FSC (at 9.64). One neat thing about FSC (if I remember correctly) is if you reinvest your dividends, you get to buy at a 5% discount. Not huge, but nice incentive to let it ride for a year.

    • Like FSC and bought it today. Thanks Marshall. Don’t like RAI as cigs are a declining LT industry and DPG is an unknown. I agree with Latetom on the volume question.

    • Marshall, as with many of your buys I also like FSC and followed you on this one.

      Do you still own CIM? I have been collecting CIM’s dividend for the better part of 2.5 years. I’ve sold some shares in the green and the remaining shares are in the red but as long as they keep paying their dividend I am in no hurry to sell. Now, if the government changes its tax policy on dividends I would have to revisit this stock and quickly.

    • Marshall, on FSC has their dividend been fairly consistant or has it gone up and down with the economy?

      • bobb.
        Just looking at the last 5 years, FSC has lowered their dividend 5 times and raised it 6 times. However, in 2010 they started paying their dividend monthly which has helped settle it down some (although they still lowered it 3 times since then). Still, they have been up and down without any apparent economic factors.

    • Ed, looks like you picked the right day to talk about FSC. Up 1.5% since I bought it on your recommendation at 9.61. That’s a pretty nice gain on this relatively low volatility stock on a day like today.

      Thanks

  3. Good Morning Marshall.
    “steady eddie stocks that will create decent income stream”
    Are these LT for you? These stocks would be good for a friend who was just involuntarily retired. May I ask what a good price to buy them for?
    Thanks much.

    • Yes CG. This are lt buys. I think current prices are relatively attractive. You can go on my blog (click on my name) and I post my entire dividend portfolio once a week. Other dividend names I like include MET, CSQ, BBEP, INTC and AOD. I also recently bought a tax free municipal bond fund for my home state (CT) as I believe a retirement portfolio should have bonds along with stocks.

  4. Trader, thoughts on silver, gold, AGQ??

    • ted, I don’t trade gold, so no comment there. Silver has made a strong breakout that surprised me. I don’t like to chase a move like this one. I would wait for a pull back and watch the price action. If it is positive, then buy. I’ll be watching where it opens, the high and low for the day and the closing price. On down days, I’ll be looking for prices that close higher than the open and the low for the day is higher than previous days. I’ll also want the technicals I follow to confirm the price action.

  5. I decided to lock in some profits on one of my PRAN positions. Here’s the final line.
    1-23 PRAN @ 8.31. Sold Feb 9 calls for 1.50 reducing my basis to 6.81.
    2-18 Bought back my calls for .75 increasing my basis to 7.56
    2-18 Sold PRAN for 9.86 plus 2.30 30.4%

    Still have more with covered calls that will expire this week.

  6. I’m going to let my SPXU I bought today ride over into tomorrow. The technicals don’t look much different after a pretty flat day.

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