Saturday, July 31, 2010

Is Gold in a Bubble

Found this chart online from a WSJ article.
It compares the runup in prices of Gold versus two other bubble - Nasdaq stocks in 90s and housing in the last 10 years.
Does this mean Gold can double from here before it is in a bubble?

Friday, July 30, 2010

Swing Trade in Google Stock

I got short 75 shares of Google on Wednesday at 487.83. This was a little after the 30 minute breakout down. I should have sold higher just below 490. So I'm starting about $2 lower than I should. My original stop was above the high of the day. Price on Wednesday closed very much in my favor. I had a partial profit objective to come out of 25 shares at 481.66
Thursday showed a strong open with follow thru up. This petered out with a double top and price started moving lower. I raised my first target to just above Wed's low at 483.66. This was filled and I moved the stop loss on the remaining 50 shares to 486.26 - above the open of the day. As this would be a clear-out since the low of yesterday was taken out. This stop was hit. Looking at the chart last night, I noticed a beautiful Head and Shoulders bottom around 12 noon. I should have moved my stop loss down to just above the neckline, shown in red, to 482.26. This would have been an extra $2 on the exit. Still a profitable trade. But, could have been $4 better.

Thursday, July 29, 2010

Upside target achieved in Euro Currency

The upside target projected by the neck line break of the Head and Shoulder's bottom formation has been reached. It is denoted in the chart by the top of the BLUE line. Recent action has shown an extension high. It this an Upthrust and a short opportunity?

Wednesday, July 28, 2010

Jim Rogers

According to the "Investment Biker"
The world has consumed more food than it has produced for the past five years. This is the first time in recorded history that’s happened. This despite there being no worldwide drought for several years.
Does this mean its time to buy grains?

Sunday, July 25, 2010

Every time you hear that someone on this planet is spending another $1Trillion, that means they need $150 from every man, woman and child on the planet. Unfortunately, 80% of the people on this planet don’t have $150, so that pretty much kicks the bill up to the 1Billion of us who can pay it at $1,000 each. If you are unfortunate enough to live in a small country like America, with only 300Million people, when your Government runs a $1.5Trillion annual deficit like ours does, that means they will be needing all 300Million of us(man, woman and child) to send in $5,000 each to cover the shortfall. If we don’t pay it now - then we’ll have to pay it later, plus the prevailing rates of interest. OR WE DEFAULT
Another reason to buy gold.

Friday, July 23, 2010

Head and Shoulders Bottom in Copper

September Copper traced out a very similar patter as the E-minis (see today's chart). The Head was a spring of earlier lows. Copper has shown nice follow thru up after the breakout. The pattern suggest September Copper could carry to 345.

Head and Shoulders Bottom in Stocks

E-Minis broke Out UP today.
The Head, Left and right shoulders are marked on the chart. Note that the head was a Spring of prior lows. A "Spring" is a break and immediate reversal of a prior pivot low. Today's close above the the line which connects the two pivot highs signifies a breakout. I did not buy today as I don't like to initiate new positions on a Friday. I will look to buy a 30 minute or afternoon breakout on Monday. The target to the upside is a move equal to the distance from the Low of the "head" to the trend line, projected up from the trendline break.
This is for educational purposes only.

Wednesday, July 21, 2010

Wow! What a day!
The day trade system got long via it's "Counter-trend" technique. The stock market has been down for a little while and today, set up the potential for a move up. Which is what happened - ON STERIODS. Quick Note - the VB and the Stemwinder2 systems use the same entry methods. The difference lies in how the separate versions of the system exit a position. The system held this trade long ALL day. Coming out on the close for over a 22 full point profit. 22 S&P points equals $5500 before commission and slippage. Of course, PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. All results must be labeled hypothetical as they may or may not have been taken exactly as shown. Please see disclaimer on our website at
The mini SPs had different numbers thanks to a slightly different price action. Still a good day in my opinion.

Monday, July 19, 2010

Rotating Day

3 Minute Chart of E-Mini S and P 500.
Yesterday (Friday) was a big down day with a high open and a low close. So we are expecting a rotating day today. A ROTATING DAY is one whose price will rotate around the open of the day. Today opened higher and showed price follow thru higher. These higher highs were NOT confirmed on the MACD. Since we are expecting a move back down to, and possible below the previous day's close, look for a short set-up. A short position could have been taken below 1068 on a break below the low of the third high. This bar also shows a tail which is a sign of sellers entering the market. Initially, place your stop loss above the high of this bar. Look to cover about a point above the close of Friday(yesterday).
Later in the morning, after price made a move below the previous day's close, a divergent buying opportunity presented itself. A long position could have been taken on break above the third drive to new lows. A stop would be placed below these lows at 10:51 EST. Looking to cover a point shy of the previous day's close. These trades are hypothetical and for educational purposes only. See hypothetical disclaimer at

Sunday, July 18, 2010

China Downgrades US

Interesting article on Seeking Alpha. If the Chinese stop financing our debt, who will? The Fed?
I'm looking for a topping pattern in US Treasuries. I'm already short treasuries via the inverse ETF : RRPIX
Stafford Daytrade had a great day Friday. The Breakout feature of the system got short the SPs around 1073. A "Breakout" means an Opening Range Breakout. Also called a Volatility Breakout. With this technique, you reference the opening price of the day. You look to go long a certain distance above the open or go short a certain distance below the open. The distances are usually some measure of market volatility. Hence the name Volatility Breakout.
Price fell all day. We held short all day. Coming out on the close above 1063. Making close to 10 full handles. Cha-Ching. Of course past performance is not necessarily indicative of future results. Please note, trades may or may not have been taken and must be labeled hypothetical. Please see hypothetical disclaimer on our website at

Friday, July 16, 2010

Buy Point in S&P 500

Daily chart for the S&P 500 September futures contract. June saw the culmination of a horrible quarter for the stock market. From the highs of late April to the low on July 1, the S&Ps were down over 16%. The talking heads were talking “Double Dip” recession. I was considering a major short position. I saw the dramatic break below the late May and early June lows. I was remembering Prechter’s prediction of 1000 on the Dow Jones and thinking this is “IT”.
Then, I delved deeper into the charts. A few key points why this might NOT be the break revealed themselves. First, price was right at the bottom of the rough channel carved out since early May. July 1 saw buyers come in and push the market higher off this point. This is evidenced by the large “tail” on the July 1 candlestick. Read the rest of the article here.