Tuesday, August 24, 2010

Technical Picture - Oversold

IBD changed their market outlook from "Uptrend under pressure" to "Market in a Correction" tonight following another distribution day.

As you can see from the S&P e-mini futures chart above, if we can't hold today's low as support, watch out down below. There's not much support between here and the July lows. After hours, Irish debt downgraded from AA to -AA by S&P.


Since the last FOMC meeting, treasuries have broken out and continue to rip higher (TLT chart above), leaving the bears firmly in control of the equity markets.

Oil inventories tomorrow at 10:30. We are approaching a support zone. Let's see if the over-supply issues start to correct.


The markets/stocks are oversold, so my strategy lately, has been to focus on leaders that continue to run on their own momentum. CRM has been a daily trade since Friday. ISLN looks poised to move higher tomorrow.


4 comments:

DW said...

Dear Jamie and Jim,

Thanks for your great posts. I have learned a lot from them.

I mainly trade 30min ORBO and pullback after big move in OR. The winning% is about 50%. I work hard to improve them but not easy. I post all my trades on my Blog everyday. Could you please visit my Blog when you convenient? Any suggestion will be appreciated.

My Blog: http://dongbwan.spaces.live.com/

PS: Could you please email me your MSN address? Then I can add you guys in the visitor list. Thanks.

My email: dongbwan@hotmail.com

Best wishes
Dongbo

James said...

Hey Jamie,

While you are scrolling through the stocks on your watchlist, how much time and attention do you put on each individual chart? (i.e. how many seconds each?)

For me, after each 15 minute bar is formed, I spend about 20 seconds per stock analyzing for an entry on my list while scrolling through (usually around 30 stocks on the list)

Thanks

Jamie said...

DW,

I sent you my email address.

Jamie said...

James,

I usually have a short focus list from my usual suspects, plus a gapper/momentum list. I seem to spend more time scrolling through the gapper/momentum stocks. But once I've narrowed the list down, I can spend more time on each chart -30 seconds - 1 minute. If I see a tight consolidation range forming (price/volume contraction), I set alerts on the inside edges of the range and I only look at it when the alert goes off.