Wednesday, September 08, 2010

Technical Picture - Consolidation

Stocks opened on a firmer note following some favorable overseas debt auctions offsetting yesterday's concerns. Leading stocks paced higher topping out around midday when the DOW failed to confirm higher highs in the Comp and S&P. Stocks pulled in slightly ahead of the Beige book which was a non-event. Choppiness ensued into the close.

As we can see from the S&P chart above, we are flagging at the cusp of the down trend line in the upper range of last week's flag pole. However, many momo stocks such as AAPL (chart below) and GS are testing resistance from the August highs. Also, I'm seeing a number of long upper shadows on the dailies of my WL.



The CREE short setup was highlighted by Steve Place on Stocktwits TV yesterday. Short on break of ORL. Price closed at the round number $50.00. Other names breaking down with volume today include V and MA.

FFIV tested resistance from last two sessions. Placed my Fibs from the low of the outside day to the upper base. Missed my exit when price suddenly reversed just shy of the target.

MTL was a HCPG pick from last night. I ignored the false BOs and placed my fibs on inside support/resistance. Worked out perfectly for a full extension.

NTAP broke resistance and rallied two points. Now it's really extended. We have a mini double top on the 15 minute timeframe. I'd like to see a retest of the base at $45.00. Could setup up a fast move lower on a trendline break.

Also watching gold names as they retrace back to their trendlines.

7 comments:

Rick said...

CMG - narrow range bars after breaking 155 level.

Jamie said...

Thanks Rick,

CMG flagging nicely - adding it to my WL.

Banenga said...

Hi Jamie

I wounder how many different tickers you got at your monitors during a trading day. I find myself confused when I focus on to many stocks.

Jamie said...

Hi Banenga,

I have a focus list which includes HCPG picks and I monitor leading sectors/hot lists through the scanners. Most of my trades come from the focus list which, on average is comprised of 10-15 stocks. If I spend too much time monitoring hot stocks, I risk missing the planned trades.

In this type of range bound market environment, it is best to focus on support/resistance levels of watchlist stocks. In trending markets, it is also possible to generate additional trades through scanners and hot lists. Easier to manage more trades in trending markets than it is now.

Banenga said...

Alright, thx for your answer.

I am just curios, how many of those stocks do watch - chart wise during the day?

Eg, do u got x different stocks, charts included on your screens all day, together with your wl?

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Jamie said...

Banenga,

On my main screen, I watch 4 timeframes for each stock - daily, 15 min. 5 min. 1 min. I don't watch multiple 15 min. charts all day long. On my gapper screen, I map out daily S/R and concentrate on 15 min. candlestick chart and 1 min. RSI price bars. I'm only looking at 1 name at a time. On a separate computer I'm running Trade-Ideas scanner and it tells me which stocks are in play throughout the day.

I set alerts at S/R for WL stocks, so that I don't have to watch them all day. I use buy/sell stop orders when stocks are basing.