A Trade A Day

Hola Amigos,

Time to get back in the saddle. It’s been a few days since I’ve written. I’ve been recovering from a cold, but I need to get going. Over the past few weeks, quite a bit has happened in the market. I’m pretty disappointed in myself because a ton of opportunity has passed.

I have always taken some time off around Christmas to do a review of my accomplishments and to plan for next year. That means giving up trading for a few weeks to focus on family, what I’m doing, and where I’m going.

Unfortunately for me, I missed a significant break in the market. I had a handful of setups that I flat missed because I wasn’t around. Oh, well. It’s hard to not to beat myself up, but complaining won’t make any money.

Let’s look at where we are and review some ideas for the weeks ahead. Let’s check the overall market.

Taking a look at the weekly chart of the Dow Jones Industrial, we can clearly see a neckline break. The down trend is confirmed in the weekly chart several other indexes:

The NASDAQ:

The S&P 500:

So, it’s apparent to me that we’re in a downtrend, and if it’s apparent to me that means it’s time to go the other way. I’m too late to the game to catch the initial downside breaks. I’m going to have to catch some points off consolidation. I’m also going to be selectivley going long, but let me make a special disclaimer. My historical winning percentage is much lower when going against the trend and I always trade smaller. Let’s take a look at a few ideas:

Who wants to take a shot at this high flier? I am anticipating a drop here. FSLR has show some resilience in the current downtrend. This consolidation may just be a pause before a move higher. But if FSLR breaks below 208 I’ll be pouncing on it.

I’m more positive on EDU than I have in the past. I think this triangle is going to resolve to the upside, but considering that it is symmetrical and the general direction of the market, it could go either way.

I like the weekly pattern and I like BZP’s daily base on base. Anything to do with oil and gas has my attention. Combined with a tradeable pattern and I’m in there.

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