Thursday, November 25, 2010

Day Trades from Watchlist - SNDK EXPD

I highlighted the SNDK and EXPD setups in Sunday's post. For SNDK, both of the targeted levels were attained in very short order.

I didn't trade SNDK on Monday or Tuesday because of the large gap. Finally, yesterday I decided to enter on the break of the ORH, otherwise I was going to miss the entire move altogether. As depicted on the 5 minute chart below, SNDK gapped open and held the PDH as support. Enter long on break of ORH. Exit half when the $45.00 target is reached. SNDK consolidated briefly and ripped another half point. The long upper shadow as SNDK tags $45.60 and pulls back, signals the end of the move.

EXPD gapped and sprinted to daily baseline in the OR, signaling that it was finally ready to BO of the daily base. Enter long as price breaks $52.00. I was targeting $53.50 based on long term resistance, but is stalled about 10 cents shy and it was time to get out as the move was very extended.

Add BIDU to the WL. As you can see from the daily chart below, we have a base forming at $109.50. Yesterday's bar is NR7 (price/volume contraction ahead of expansion). Since testing support last week, we have carved out a higher low and BIDU is forming a mini ascending triangle base. Target is daily resistance at $115.00.

The 15 minute chart shows how clean the underlying base is.


Andy said...

hi Jamie,

How often do your stock picks run to your target extension? it seems to me roughly half to 3/4 of the time it will pause out earlier.

Also, how do you determine if the stock is stalling out before it reaches the target and ready to reverse?

Jamie said...

Hi Andy,

I'm satisfied to get a 61.8% FE, except for chart patterns such as flags and C&H where I still target the full 100% extension. The ones that stall out before reaching the target seem to stall out at the half or whole $ levels, so I watch very closely at those levels. If I see topping shadows on candlesticks and/or negative divergence of RSI, it signals the end of the move.

This works well for highly liquid stocks like AAPL, AMZN SNDK..., but more difficult with less liquid names where we sometimes need trader's intuition.