Traders Corner (7/18/2014)   26 comments

The S&P 500 levels to watch today:

UPSIDE: 1959 (2 data points), 1962 (July 1st’s low), 1965 (2 data points), 1967 (20 day moving average), 1968-1969 (2 data points and June’s high), 1972-1984 (13 data points), and 1985 (July 3rd’s high and the all-time high and the top of the Bollinger Bands).
LAST CLOSE: 1958.
DOWNSIDE: 1955 (July 17th’s low), 1952 (July 10th’s low), 1948 (bottom of the Bollinger Bands), 1934 (50 day moving average), 1924 (May’s high), 1915 (June’s low), and 1899 (100 day moving average).

S&P 500 Daily Momentum: Bearish
S&P 500 Daily Overbought/oversold: Slightly oversold
S&P 500 Weekly Momentum: Mixed, trending bearish
S&P 500 Weekly Overbought/oversold: Neutral
S&P 500 Futures: Leaning positive
Overall: This may just be me, but I think the markets were looking for any excuse to drop yesterday. An airplane crash over a war zone is a pretty lame one (why was the plane even there?). We get options expiration today, so expect the unexpected. With the McClellan Oscillator now in oversold territory, I would expect no more than a small drop today, and an oversold bounce is a stronger possibility.

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26 responses to “Traders Corner (7/18/2014)

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  1. UVXY @ 26.82. Sold most of what I owned yesterday. Have some room to play again.

  2. Trader, are you jumping on GLUU?

    • Probably not. I want to see how we end the day.

      • Is it a bad idea to buy a stock trading outside of it’s keltner channels?

      • Yes if it is at the top of channel. A stock may move up as it reaches the top of the channel so you don’t necessarily want to sell. You can’t rely on any one indicator. If the price action is good and other technicals are supporting the move, it will probably move higher. On the other hand, if it breaks above the channel like GLUU did this morning on the 3 min chart it will almost always pullback or level off shortly after the breakout. The stock may move higher but it will usually be from a better entry point. Think the reverse if it breaks out of the bottom of the channel.

      • Good info it’s going to take me a bit to understand and see it. Just looking this morning UCO is rebounding and could move higher next week. Gtat is still at the bottom of it’s chart and could be a good one next week. GLUU That is so over bought it’s hard for me to tell. On the daily it’s has a RSI of 86.
        I think I’m going to enjoy my birthday and buy a 12 pack and go split some fire wood.
        Everyone have a great weekend 🙂

      • Bill R – have a great birthday!

      • Thanks Marshall

    • Gluu is been on nice flight upwards, expect it will come back a little when market corrects but they still have a big game in fall coming out with the Diner Dash series. That series of games has had over 500 million downloads in 10 years and this will be I think the first new one in a year or more. They do have some other games like an new update to their popular Contract Killer coming out in fall and a new MLB game coming out in August also.
      GLUU has always been strong in the Action area but now with the Kim K game and Diner Dash they are expanding into new areas and customers. They may become the most broad based mobile game company out there.

      • Thanks bobb. It held up well yesterday and option premiums are high. I’ll look to reenter next week if charts still look good. I suspect it may level for a bit.

  3. Sold Aug 16, 70 calls for my SCTY for 2.80

  4. sold Sept 20, 16 calls for my 2/3 rds uncovered GTAT shares for 1.20. Not all that sure of this one? I like the shares so would have preferred 18 v 16 calls but the premiums weren’t meaningful. Wanted to “get it while the getting was good” but if shares are assigned at 16 I make a decent profit but not like what I want.

    • Jeff, I’m going to have trouble keeping up with you. 🙂 All of my GTAT calls will expire worthless today. If the market doesn’t fall apart, it looks like GTAT is ready for a bounce. It is definitely over sold and I’m seeing the beginning of some technical strength. I’ll probably hold for a bit before selling calls again.

    • Looks like a good move on GTAT Trader. I already wish I had waited a little. My calls are only up a nickel from when I sold them but looks like I could have sold higher. We’ll see.

    • THis confirms what Marshall has previously mentioned but I would like to point out that the blogger has “1” follower. Doesn’t mean he’s wrong, just that he’s untested?

      • Thanks Jeff I must have missed Marshall’s post. I’m learning when a stock is in a decline any bad news affects it.

  5. Trader, Does Pxlw look overbought? I would like to add more at this price.

    • Lynn, Looks overbought on the weekly and neutral on the daily, but showing weakness. I own it at 8.87 covered with August 10 calls. I’m thinking this will be a longer term hold. Price action over the last few days has been weak. I don’t think I would be in any hurry to add.

    • thank you trader for your time to response to my question.

  6. Trader what are charts and your opinion of telling you about PM?

    • Weekly and daily charts look neutral. It’s trading in the middle of its one year weekly trading range. If this is a long term hold, it looks ok. I would guess it should hold up reasonably well on anything less than a major market correction. I didn’t check the dividend but I assume there is one. I’ll also assume this is a long term hold. In that case, you could consider selling long term calls with a strike price of 90 to 92. This area has been resistance. You could probably pick up another 2-3% in addition to the dividend as well as give you some down side protection. It doesn’t look like a high flyer. Nothing wrong with slow and steady if that helps you sleep at night.

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