Apple Poised For a Big Move $AAPL
I have been watching Apple Inc. ( $AAPL ) form a symmetrical triangle for the past two months. This is a Continuation Pattern, which means that the triangle is used as a way to head higher if the trend has been upwards and with AAPL it has been.
A symmetrical triangle is generally regarded as a period of consolidation before the price moves beyond one of the identified trendlines.The sharp price movement that often follows a breakout of this formation can be captured by traders who are able to identify the pattern early enough.
The Symmetrical triangle pattern needs to have a few things working for it and we will check them off here.
1. Trend Should be at least a few months old: Check !AAPL is from march to december.
2. Duration of pattern should be at least 3 weeks old: Check! This pattern is 6 weeks old.
3. Breakout occurs between 1/2 to 3/4 of the way through the pattern: Check! It's about 3/4 of the way.
So now that we checked a few major points off let's look at a price target. We take the distance from the widest end of the triangle and in this case is around $20.
From the breakout at around $200, this being a bullish trend apple has been in we add $20 to the upside and put it at ~$220 for a potential breakout target.
There are a few hurdles here for AAPL though the $207-208 area is major resistance so if it can break that $220 is well in sight.
I bought a January $230 Call option at 0.23 to prepare for the move instead of putting major capital in the stock
Here is the chart (Click to Enlarge)
Update: I tried posting it last night but my host was down so i gave up. $AAPL is currently at ~$207.50 (in between the resistance I mentioned)
I have also sold my Call options for a hefty 140% Profit from yesterday's buy-in price, if Apple breaks above 208 I might be re-buying some.
Merry Christmas!!
Downhill from here Or more upside?
The SPY made a hanging man candle today and so did a few other stocks like C (reporting tomorrow before open)
It happened on a bullish trend so it is defenetly a bad sign.
It is late but I will update tomorrow with more writing and of course my favorite thing; charts!
-K
The One Day Rally Is Over!
Last night I posted about the S&P possibly having a Kicker Bullish Setup.
Well The S&P Rallied 18.60 points to 1062.98.
The Setup was not executed perfectly (market would have had to gap higher today then go the distance)
All bets are off on an extended rally that needs to go higher than 1080.15 to be worthy of anything.
While the market rallied the S&P only traded at half its normal volume.
Stocks like Citigroup which had traded over a billion shares a day, are lately trading at less than 500 million.
The TED Spread which measures the general risk in the economy has been rising the last couple of weeks. today alone it rose 5.42% which means interbank loans are now riskier. This is still not significant enough and I would like to see another 33% increase in the TED before I really put a lot of my sidelined money on the short side.
We had MBIA (MBI) stock trade up 11.38% today only to be down over 7% in after hours.. why?
Standard & Poor's on Monday cut its ratings on MBIA Inc and its structured finance insurance arm, MBIA Insurance Corp, citing an expectation the company will continue to take significant losses from insuring risky loans. ... The outlook for both companies is negative
Well if that wasn't enough the dollar has began to show some strength as well despite the almost 20 point one day rally.
Bottom Line: Be very careful if going long from here on out. The false optimism game has been played for far too long and you might get stuck holding a worthless institutional stock come October. It's also end of month markup so for the next few days prices might be kept afloat by institutions.
Have a good one.
-K
$SPX Stuck in a 9 point range..Which way will it Break?
The S&P 500 index is stuck in a 9 point price box.
1051 is resistance from October 2008.
1042 is support from the last 3 days and also the 18SMA.
We need to see 2 or more days of market closing either above or below one of these 2 points before there is any significant breakout or breakdown.
For the moment we have a setup for almost a Kicker Bullish setup but the 3rd red candle that was put in on Friday doesn't make this a perfect pattern.
If on Monday we follow the Kicker setup, we might have a move to higher highs (above 1080).
The setup is not exactly a Kicker but it fits the bill very well. If $SPX closes below 1042 for 2 or more days then next support is 1030 which would be the defining moment of this "Bull Market".
Here is the attached Daily and Hourly chart (Click to Enlarge)
Look for an update by next weekend if the setup plays out.
-K
Mini Correction, Mini Recovery Then Massive Correction?
As I posted a while back, (See the "Fake Correction Followed By Fake Rally?" article if you missed it) the $SPX (The S&P 500 Index) has nicely corrected to satisfy me that there will be another move up 20-40 points to shake off more bears and when they are nearly all out (If market makes a higher high it will be seen as very bullish) it will have a massive correction to trap bulls and make bears cry for getting out too quickly.
I will be revisiting the charts I drew in the previous article mentioned above. Let's start with the closer look in the past 3 days.
I was waiting for the SPX to break either the red or the green line and close below it. Well yesterday it did just that and that was the first clue as to where we were heading today.
The blue arrows are there to just demonstrate the Support line and where yesterday's close was. Grey line was my prediction for the next 2 weeks or so but it was defied by the market as it tanked lower and lower. (Click to Enlarge)
Second chart is the long term view of things and 2 possible outcomes that this investing freak sees realistic.
Scenario 1: (Orange Lines) Bounce back the next 5 days to reach possible 1040 (ADP Nonfarm Employment change tomorrow morning so this could happen if it "surprises") then drop back to 1000's and head lower going into October.
Scenario 2: (Green Lines) Go down further for the next day or to and reach 985-990 for a close (it could go down further and still close above 985 to be valid). Then hit ~1020 shake a few shorts that believe 1000 level has cracked and proceed into 950's.
Scenario 3: That's your opinion and I would like to know 
Here comes the updated chart. (Click to Enlarge)
Good luck! and don't forget to follow me on:
Twitter ( http://twitter.com/investingfreak ) or Stocktwits ( http://www.stocktwits.com/u/investingfreak )
For the latest live commentary.
-K
$VION; A perfect trade using the Morning Star Pattern
Today I had a chance to experience those special conditions that cause a day trade to turn into great profits.
The stock chosen was VION. It was down 45% for the day on no news. (It is a Pharmaceutical so I thought some bad drug news came out).
As I watched the price slide down like a waterfall I saw a reversal form. This reversal in candlestick patterns is called the Morning Star.
The patterns is a bottom reversal signal. It is most effective following an obvious downtrend (in this case from 6.50 to 2.20)
According to Candlestick Trading Forum:
The Longer the black candle and the white candle, the more forceful the reversal.
The Pattern psychology for this specific pattern says that when the price goes down fast sellers get panicky. They keep selling off and as they are doing that bulls begin to step in.
Now that I have explained the pattern I used time to explain the entry and exit signals.
Entry 1: 100 shares at 2.90
This was an initial entry to test the playing field.
Entry 2: 100 shares at 3.50
I was looking for price to close above 3.25 for 2 consecutive candles to buy into strength. 3.25 if you can spot it is a resistance from earlier candlesticks.
Exit 1: 100 shares at 4.01
4 is a round number so that makes it psychological for people to dump shares
Exit 2: 100 shares at 4.53
Looking at the far left 4.53 is around where the 2nd large red candle begins. and if you look up further more candles tend to end around 4.75.
Initially I had the limit sell order at 4.74 but I then decided not to push my luck.
Conclusion: After concluding the trade I watched the price go at high as 4.90 then in one big swing it crashed back down to 4.
Overall it was a great risk reward ratio and a well thought out trade. Morning star followed by an initial entry to test strength of the pattern and if it goes your way add another position which will allow you to scale out. Now this did take 2 day trades out so if you have under $25k account you will only have 3 trades in 5 days so it's really not ideal to do every day.
Here is the image to illustrate all the text in this post. (Click to Enlarge)
Hope you enjoyed it and while I do understand this is not a stock pick because it is already gone I hope it serves as a teaching tool to how simple trading can be at times.
-K
Shooting Stars are everywhere. Is it time to turn into a growling Bear?
I noticed something strange today looking at my favorite timeframe. (half a day )
Stars were shooting everywhere.
Many symbols like $SPX $SPY $INDU $OEX $COMPX $QQQQ etc had the shooting star pattern to an extent.
I chose to include only 3 to keep it simple
Now before I insert the image I would like to explain what a shooting star pattern is thanks to Stockcharts.com
Shooting Star: A single day pattern that can appear in an uptrend. It opens higher, trades much higher, then closes near its open. It looks just like the Inverted Hammer except that it is bearish.
Here is a visual aid to go with the definition. (Click To Enlarge)
Now bear in mind this is my own opinion of what I see happening. My system has yet to give a sell signal but today I did receive a sell in GLD so if gold is losing value that means market is going down (most times that's the correlation I've seen.)
Now listen up you Goldman Sachs! Stop reading my blog and proving me wrong. Let the market go down like it wants to.
Thank you very much.
-K
Summary of picks from yesterday
Yesterday’s picks turned out to be right on. Although with pathetic moves, AMD gained its way up. It has been trying to break its new resistance at $4.50 majority of the day. Unfortunately, I followed my plan and sold it in the morning to break even (including commission) because I did not have any more patience from watching it a day before. If I would have kept it for the day and trust my own gut, I could have made easy $0.2501 per share (or 6%). I hope some of you had more patience and easily profited on AMD. The lesson to be learned from this is that I’m very impatient trader.
AIB is hanging strong. Even though I intended to keep it for a longer period of time, I sold it with $0.26 per share profit (or 9%) because I needed net liquidity for other trades I did today. With that said, AIB is still a keeper and I will very likely get back into this stock some time this or next week.
| Company | Buy Date | Sell Date | Buy Price | Sell Price | Gain/Loss |
|---|---|---|---|---|---|
| AMD | 5/18/09 | 5/19/09 | $4.1399 | $4.15 | - |
| AIB | 5/18/09 | 5/19/09 | $2.89 | $3.15 | 9% |
Although single digit, 9% profit overnight is always nice.
Let me know what you think about those two picks in the comment box.
Two picks: AIB and AMD
This is my first blog post here. As a friendly note, I assume no responsibility or liability for your trading and investment results. Do not forget, this website is solely for entertainment purpose only.
Today the trading day started with generally high buying demand and ended the same. My two picks for today are: AIB and AMD.
| Company | Buy Date | Sell Date | Buy Price | Sell Price | Gain/Loss |
|---|---|---|---|---|---|
| AMD | 5/18/09 | - | $4.1399 | - | - |
| AIB | 5/18/09 | - | $2.89 | - | - |
All indicators aside, I think AIB is one of the financials that is undervalued. According to Zacks.com, in its first quarter trading update, AIB "announced that operating profits before bad debt provisions were higher than the year-ago quarter, reflecting strong performance of its Capital Markets and Global Treasury divisions." That not to say that they do not have problems- they still experience declines in operating profits, net interest margins shrink, etc. The point is not many institutions are problem-less. As of the close today, the stock is at $2.90 so it is still a penny stock. Most likely it will be a longer term play for me.
AMD is a pure technical play. It has a major support somewhere between $4.07 and $4.12 (as indicated on the graph below). I bought it at $4.1399 hoping that it will break its trend of fluctuating and find its way up. It did surge, but not as high as I was expecting. The bears and bulls are still fighting. Depending on pre-market, I will most likely sell this stock in order to break even (including commissions).
Stock Alerts of the Week May 11 – May 15 2009
WoW what a sea of sell signals there was this week. This is the longest sell list I have seen.
Of Course this meant BUY for the short ETF's which you will see below with exception to ICE (not a short ETF) which seems to be in its own little world up in the ICE(y) north pole.
Picks of the week of May 11th to May 15th 2009
|
Symbol |
Buy Date |
Buy Price |
Sell Date |
Sell Price |
|
$SPX |
5-13-2009 |
905.40 |
||
|
$INDU |
5-13-2009 |
8461.88 |
||
|
$COMPX |
5-12-2009 |
1743.52 |
||
|
IWM |
5-12-2009 |
50.82 |
||
|
SPY |
5-13-2009 |
90.01 |
||
|
IYR |
5-12-2009 |
34.00 |
||
|
AAPL |
5-12-2009 |
129.71 |
||
|
BBT |
5-11-2009 |
25.02 |
||
|
BCS |
5-12-2009 |
16.87 |
||
|
BAC |
5-13-2009 |
11.95 |
||
|
ICE |
5-12-2009 |
93.28 |
|
|
|
ING |
5-13-2009 |
9.56 |
||
|
FAZ |
|
5-14-2009 |
5.81 |
|
|
F |
5-12-2009 |
5.77 |
||
|
SDS |
5-13-2009 |
59.68 |
||
|
SRS |
5-13-2009 |
22.81 |
||
|
SSO |
5-13-2009 |
25.02 |
||
|
SKF |
5-13-2009 |
47.37 |
||
|
UYG |
5-13-2009 |
3.92 |
||
|
URE |
5-12-2009 |
3.97 |
||
|
URG |
5-14-2009 |
1.04 |
||
|
UNG |
5-15-2009 |
16.19 |
||
|
JNK |
5-15-2009 |
33.60 |
||
|
HYG |
5-13-2009 |
76.52 |
||
|
FSLR |
5-13-2009 |
187.05 |
||
|
V |
5-12-2009 |
65.85 |
||
|
ICO |
5-13-2009 |
2.93 |
||
|
TZA |
5-13-2009 |
28.36 |
I hope you are enjoying the picks so far. Without suggestions and comments I cannot improve this blog so I strongly encourage comments.
-K
Stock Alerts of the Week May 4 – May 8 2009
Last week's picks have so far turned out to be good. DRYS is up almost 30% since signal.
Let's move to the score card. 5 positive gains of over 10% each. BAC signal got changed to a buy from a sell just 2 cents difference, and $BKX is acting up in my charting software so I will just eliminate it from watchlist.
Picks of the week of May 4th to May 8th 2009
|
Symbol |
Buy Date |
Buy Price |
Sell Date |
Sell Price |
|
QQQQ |
|
|
5-7-2009 |
34.29 |
|
BAC |
5-4-2009 |
8.82 |
|
|
|
REW |
5-7-2009 |
48.31 |
|
|
|
MOV |
|
|
5-5-2009 |
8.98 |
|
DRYS |
|
|
5-8-2009 |
8.36 |
|
URE |
5-8-2009 |
3.70 |
|
|
|
CFX |
|
|
5-7-2009 |
8.50 |
I hope you are enjoying the picks so far. And just let me know about any suggestions on the comment box
-K
First Forward Testing of the system a Success [MOV]
Forward testing is when you use a strategy and instead of back-testing it with previous data you actually test it going forward and preferably with real money.
For my new system MOV became that victim stock to be tested.
I first got a buy signal on April 17 2009 (Bought on the 20th at market open), i got in at 7.67.
I got a sell signal on May 5th 2009 and I sold at 8.81 with a market order.
I got about 14% profit on a 19 day long trade.
I don't have a chart to post with this one but just wanted to say this first forward testing trade worked well.
Here's to more good trades.
-K
Stock Alerts of the Week April 27 – May 1 2009
As I stated in my latest blog post I wanted to begin giving stock picks based on my trading system.
I have created a page above with all the picks and wouldn't mind people asking for symbols to put on watch list.
I will also try to post a week in review with the signals given out for the week.
Here are the picks for April 27 to May 1st 2009
|
Symbol |
Buy Date |
Buy Price |
Sell Date |
Sell Price |
|
$BKX |
4-27-2009 |
34.54 |
||
|
BAC |
5-1-2009 |
8.84 |
||
|
DRYS |
4-30-2009 |
6.72 |
||
|
ICE |
4-29-2009 |
84.14 |
||
|
ING |
4-29-2009 |
8.34 |
||
|
UNG |
5-1-2009 |
13.72 |
||
|
ICO |
4-29-2009 |
1.90 |
As always these are picks but I am not responsible for any financial losses you make following these picks. I wouldn't mind a share of your gains though.
-K
Current Picks
LAST UPDATE: 9-25-2009
9-24-2009 is full of new signals, mostly sell.
This page is intended to provide buy and sell signals given by a strategy.
Those who like my calls can follow or at least consider the alerts; those that think this is all fake can keep opinions to themselves and check the info page. Amount of time in the market using this system is about 38% on average which means you are not in at all times. It is not a buy and hold strategy nor is it a day trading strategy unless very rarely a buy and a sell signal occur on the same day.
I am only giving the latest signal for each stock mentioned. Use at your own risk and make sure to take the date into consideration.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Market Indices and other important Quotes
(Note: I understand you can’t purchase an index so bear with me these are just signals)
| Symbol | Buy Date | Sell Date |
| $SPX | 9-24-2009 | |
| $INDU | 9-24-2009 | |
| $COMPX | 9-24-2009 | |
| QQQQ | 9-24-2009 | |
| IWM | 9-24-2009 | |
| SPY | 9-24-2009 |
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The Rest of the Symbols (More will be added per request)
| Symbol | Buy Date | Sell Date |
| IYR | 9-24-2009 | |
| AAPL | 9-4-2009 | |
| DRYS | 9-23-2009 | |
| SDS | 9-24-2009 | |
| SRS | 9-24-2009 | |
| SSO | 9-24-2009 | |
| SKF | 9-24-2009 | |
| UYG | 9-24-2009 | |
| URE | 9-24-2009 | |
| JNK | 9-8-2009 | |
| HYG | 9-8-2009 | |
| REW | 9-25-2009 | |
| QID | 9-24-2009 | |
| QLD | 9-24-2009 | |
| XLF | 9-24-2009 | |
| DIG | 9-24-2009 | |
| DUG | 9-24-2009 | |
| SMN | 9-24-2009 | |
| VXX | 8-27-2009 |
Stock tips from the Freak strategy
After SKF's latest blunder in which I called the sell-off then couldn't resist the LOW LOW price of $155, I set off to design a strategy that overtime would bring consistent growth. I am using a 4hour interval for the strategy so it really isn't day-trading but also it's not long term investment (like those exist much anymore).
The idea is to give stock tips when the strategy throws me a Buy signal then to call the selling point when the strategy yells SELL.
Now If i use the S&P 500 or the Russel or any other index (all the stocks within it), I will get a lot of buy and sell signals that will drive me crazy.
I'm wondering if any of you have ideas on which stocks to put on watch list. I will also need to create a section on this page to show the buy and sell signals with their dates as well as how much gain/loss occurred.
I think i might be going a bit over my head as many people do this for a fee (Timothy Sykes anyone?) but I will think this through for the next week or two and then decide what to do. Your comments are really needed this time especially for ideas on which stocks to put on the alert list.
Till next Time,
-K (The busy man)
