Reminder: Harlan is available to chat with Members, comments are found below each post.
And here we are still in the little PINK Pullback Off Highs (POH) b wave channel that’s building itself out. Remember its bull channel.
One thing you can see here is that the Pink POH line IS in definite play. We bust over that with conviction it could unleash a fair amount of short covering and a here comes Santa Claus type move. We’ll see.
The big question today is if yesterday’s weakness WAS the end of the C wave as shown in the short term charts. We’ll know in the next few days.
Game Plan For The Week Of December 12 thru 16
Keep in mind this week is options expiration.
12-14 If I’m not mistaken there are 2 puts for every call out there. If they (the street) wants to inflict some pain on the bears then they have all the ammo they need to do so.
If they really want to kill the short sellers who are attached to the perma bear outcome vs. letting the market confirm that thinking then Wednesday thru Friday are going to be the days to do it. After all we are also in the "Paint The Tape" Window Dress for the year mode so that is also something that is going for the bull cause here into year end. We’ll see, we’re not jumping to any conclusions here we’re just throwing out a potentiality. All that aside there is a lot of positive short term structure out there (a bit overbought but nonetheless) and very little negative daily chart perspective structure out there.
So we’ll use market weakness in issues with chart structure that we can work with and continue to nibble on the long side. Our long side watch list has a slew of NEW names that COULD participate should we go on a run here sometime between now and the Holidays. Another theme that we all need to continue to be aware of is that of a Jack be nimble Jack be quick type of market that can spin on a dime in both directions so be aware of that. Things could get rather fast the next week or two. Don’t worry about it just watch the chart structure and not the news. That’s another reason we’ve had the success we’ve had through one of the most difficult times we’ve seen in years.
12-13 This morning we did a little nibbling on a few issues and will continue to slowly but surely pick and choose off the longside watch list from here on out all.
BIG PICTURE BULLISH AND BEARISH COUNTS
We’ve moved this conversation to the newsletter achieve in the paid subscriber site and anytime we need to update it we’ll do so and send out an update to it. Believe us it ought to come into play next year.
SHORT SIDE WATCH LIST
12-5 This is a WATCH LIST and we stress WATCH. DO NOT SHORT ANY OF THESE NAMES JUST YET.
GMCR
NEW NAME TO WATCH and we stress watch
12-7 Could easily bounce back up towards the upper red line and 50-day on a continued Santa rally. At that point, we’ll want to take a serious look at a short-sell position.
12-6 Given this could just be a pullback in the markets to relieve the overbought nature of things before one more potentially ENDING push higher into year end we’ll just watch this issue to see if it too could get one more final push. Then we get serious on the short side.
LNKD
NEW NAME TO WATCH and we stress watch
12-12 Speaking of newer issues, we’ve got a theme going on currently and this is Wall Street’s RUSH RUSH RUSH to get a bunch of IPO’s out the door before first of the year. Two fold in my book. One is the Investment banking fees they NEED to make they’re numbers and two is because they know that come early next year when we move into a really crappy market environment they will not be able to get those deals done (and boy would the VC guys scream about not getting they’re exit!). Gotta sell peanuts while the circus is in town right? And that folks is your "Let’s play name that game" for the day and it is a game, a game to take YOU’RE money.
12-11 Rallying up to the 50 day? Or shall we say into the secondary offering so as to allow insiders who are selling to get the most bang for their buck all the while the little guy gets taken to the cleaners when all said and done. Case in point, have you seen FIO lately?
When and IF the time comes to short this name, odds favor there will not be any stock available for shorting, or at least not too much mind you. But then again if the secondary hits and all the insiders and big boys are out and all that stock is in the little guys hands? There is going to be a ton of stock available for shorting. We’ll see. If not it’s deep deep in the money puts will have to be the play. Time will tell in the meantime let’s watch this issue.
We haven’t looked when the 2ndary is due or if it even has already taken place yet just so you know. Anyone got a date? If so email it.
LONG SIDE WATCH LIST
"Only The Best And Forget The Rest "
"We Trade What We SEE, NOT What We Think, Hear Or Fear "
12-13 Our whole game plan from here on out till year end is to pick and choose on the long side names that we don’t have to chase that have chart structure we can work with. All from a hit and run trading standpoint.
There are 11 names on this list. Personally there is no way we are going to be able to do everyone of them. We’ll pick off a few here and there but we wont be able to do them all, unless we were to launch a new service called a basket case or a three musketeers all for one and one for all service where it’s an automatic buy ’em all like a HFT (High Frequency Trading) fund does and turn around and flip out of them an hour later. Interesting idea to explore, we’ll give it that.
APA
12-13Nice and tight POH bull channel building here. See the open on this issue and CXO?
CXO
VMW
12-13 I’m just not liking the action here. This issue also doesn’t have a lot of upside scale to it to a retest of its highs. We’ll pull this name off the watch list for the time being as we have more than enough to keep us busy.
12-11 With all of the above notice how they all have those little pink POH bullish trend channels much like the indexes do? All for one and one for all has been the theme this year. Market busts higher odds favor these all do. Much like we saw Friday where we opened and everything was up a bit but the market got stronger and everything took off like a rocket? Same deal here. It’s also why we want to nibble (sometimes you just gotta "Be There" in advance) vs chasing a gap up if we were to get one sometime next week, assuming we bust higher that is.
HITK
12-12 That 36 level gets my attention. Its not only uptrend support its also the 50 day average. Speaking of the 50 day average? As you scroll thru this watch list you can see a lot of names are pulling back to it. Nothing wrong with that I tell ya, its actually quite positive.
12-11 Ask yourself, What is the overall trend of this stock. bottom line its in a clearly defined uptrend that has pulled back off highs (POH) to near the 50 day average. What’s not to like.
CAT
RHT
AKAM
SNDK
CVLT
FFIV
12-13 I’m just not liking the action here. This issue also doesn’t have a lot of upside scale to it to a retest of its highs. We’ll pull this name off the watch list for the time being as we have more than enough to keep us busy.
REMEMBER from here on out thru year end everything is just a trade. hit and run, get in get out and pay yourself along the way not to mention Christmas if that is a tradition in your family.
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CURRENT POSITIONS
"Let Your Stocks Tell You What To Do By The Action They Exhibit"
NOT YOUR EMOTIONS!
LONG SIDE POSITIONS
VHC (We are long 300 shares of this at 21.64 as of 12-13-11)
JOY (We are long 150 shares of this at 87.13 as of 12-13-11)
NOTE: Earnings are due BEFORE THE OPEN TOMORROW.
Analysts are expecting Joy to report earnings of $1.85 per share, up 33.1% from a year ago when it reported earnings of $1.39 per share.
Analysts are expecting earnings of $5.87 for the fiscal year per share.
Revenue is expected to come in at $4.42 billion for the year.
Its your call as to hold or fold before the close, Im fighting with it. Given the chart pattern and tightness of it coupled with it being above the 50 day average I’m apt to take my chances here. That’s us, you have a choice too you know. You can choose to live or die by the sword with us or you can walk away before the close. I do this knowing full well the issue is a 50/50 proposition. Odds favor one of two things are going to happen here. Big pop or big drop and no in between.
Now the one thing we also want to point out that allows us to be ok with hanging on is that our risk is limited due to trade size risk management. this position makes up 7.2% of our portfolio. A 15% hit in the form of a drop has an impact to the total value of our portfolio of 1%. So you see again its all about trade size risk management. If it pops? We walk away and lock down some gains. If it drops we’ll take a close look at whether we want to hold or fold.
ATHN (We are long 250 shares of this at 59.53 as of 12-9-11)
Gosh as for a stop loss? One could use any break of the 50-day average on a closing basis or just a break. BUT beware of the trade bots out there who have a habit of popping stops for stop orders that are showing on the books of broker dealers. When you place an order on the books, a physical order you are showing your hand and everyone can see it , everyone is the market makers and the high frequency trade robots so be aware of that.
Us? We adhere to trade size risk management and we could take a 20% loss on the issue and the impact to our portfolio would be about 1% to the whole. That’s one way around the trade bot search and destroy popping of stops for ya. Just saying if food for thought.
NUS (We are long 250 shares of this at 46.42 as of 11-28-11)
12-8 Still looking good. Pulling back nicely toward trend channel support — a move into the low 50’s and we’ll look to lock in our gains.
12-1 Looking ok here. A break below the C (red line) and we have to walk away.
