My Tickerville Summary - Ideas Week of 4/13/09

Disclaimer: The majority of these ideas come from the @Tickerville Saturday morning brunch. In fact, many of these are direct quotes that I use as a check-point during the week. Trade at your own risk. Any reference to "I" is from @tickerville. The blog author did not grammatically update that piece.

**Thanks to StockTwits for hosting. An excellent venue!

OK, I want to start out this weekend with a statement that I wish I could scream from the mountain tops. STOP FIGHTING THE blanking TAPE!!!! Let's break it down a bit. There are 2 tanks for a trader. An emotional and financial. You must keep your financial tank in tact to stay in the game. That is RULES based, but your EMOTIONAL tank allows you to execute. If you are busy fighting the tape, you are depleting the emotional tank and cannot execute with confidence.

Wow, I am fired up this morning. Do you LOVE WHAT YOU DO?? I can't think of anything better than stocks. Geesh.

If you find yourself zombie like, because you don't 'believe' the move, then chose to do 1 of the following. A.) Do nothing, step away and let the market do what it is going to do. Detach yourself from the ticks. I do it often. B.) Play small, VERY SMALL to at least rebuild the confidence level and to see what is working.

The #1 problem with traders is how you began your statement. "Convinced" Or 'Think" or 'Assume'. I am so sick and tired of jamokes guessing and imposing their belief on the tape. Follow the TAPE, it NEVER Lies!!

Let's get started!


I got tons of feedback on this (XLF) as everyone waited and watched for the break to come. Well, it broke. http://twitpic.com/35j2n I think we all should keep a graphic of this chart by our computers at all times. While the world was debating, note how XLF digested. Whether you are playing the fins directly or not, it is the heart and soul of the tape. We have to keep this chart up to be our guide. Will it retrace? Sure it will, but now we pull out past Brunch archives to determine whether or not it is healthy.

My best mover this week was BAC long. Not just a position in my fund, but publicly held in Minyanville portfolio as well. While others fight it,I peeled off a portion, raised stop to guarantee winning trade and now looking for remount http://twitpic.com/35jaa

OK, We'll come back to the indices in a bit, but I want to touch on something that is getting NO press but very important. Clearly, we are in earnings season so get in the habit of checking when your names report. I am NOT an EPS gambler. OK, back to previous point. Its EPS season and as I pound in Tickerville.com members heads. It is NOT the report, it is the REACTION. I could care less about a report, all I care about is what a stock does after a report. This is what is so important to understand.

AA -short from saying they were going out of business. It was a TERRIBLE quarter. How has stock reacted? http://twitpic.com/35jms

MOS -just as awful. Didn't they even guide lower? Reaction excellent and a descent set up going fwd. http://twitpic.com/35jnp

BBBY -retail play busting out. Terrible quarter? you bet. http://twitpic.com/35jpf

Now, the point of these charts are not to say I will go long these stocks, nor will I start betting on earnings. The point is to understand where we are in the game. Whether or not these reports have been priced in. These stocks say they have been.

OK, several weeks ago, we broke down EEM mystery chart as noted here: http://twitpic.com/1wn6e/full The reason I bring this up, is not because I want to pound chest. I LOATH that, it is because I want to discuss the process. Whether or not it worked was irrelevant, it was a matter of identifying the setup, identifying the stop, and taking the trade. I posted 2 charts that week that were interesting to me. Both weekly, (as noted below) and daily. http://twitpic.com/1wnkk/full Of course I heard all the garbage about international mkts, which went in one ear and out the other, but the pattern was sound. EEM is now one of the strongest ETF's out there and we can move our stop where noted on chart. http://twitpic.com/35kbj

You see, trading is not about picking a hot stock or sector. Stock picks are a commodity. It is about execution. The more I grow as a trader / money manager, the more I learn that it is about refining the trading plan, rather than finding ideas.

To recap begin: We all must look within and see if we're fighting or embracing moves. We must realize where the financials are in the game ala breaking out and watch their retracement to measure health. We must understand how stocks are reacting to poor earnings. ala MOS, AA, BBBY and we must remember ala EEM that it is not about the stock / ETF, it's about the darn plan.

CHARTS - Alright, trading lessons over, let's get to the here and now.

We've talked at length about 840 on S&P and its importance. We're now back above this level. http://twitpic.com/35klk The mother trend has been broken and we now must study health of consolidation. It is important for 840 to hold on retracement. Note the volume on Friday's break.

QQQQ is the strongest index around. Note the break off double bottom. http://twitpic.com/35kqk If you aren't accustomed to looking at weeklies, you should start. Much easier to see double bottom here http://twitpic.com/35kui

IYR - This has been a classic trend break. Break, Kiss, Follow Through. http://twitpic.com/35ky6

IYT is still offering good risk reward, and needs to hold the Nov low base. http://twitpic.com/35l2q I watch those ETF's all day every day for clues. So far they are acting very well. The IYT needs to be observed closely.

Alright, so after have a few great weeks, all accounts hitting new all time highs, what is plan for this coming week? If the long weekend knocks some sense into traders and they come in giddy, I will sell inventory into morning gap. If we open flat to down and start the consolidation process, I will watch current holdings and new ideas closely. I have already peeled off to protect gains, and raised stops, so now it is all about position management.

Let's look at some places I'll be eying this coming week. Please note, I will chase NONE of these. I want prudent entry with stops in place.

MS is one I am watching closely and started Friday. http://twitpic.com/35lg9

I attempted ADI on Friday but closed it when it did not close at highs. It is one I want to remount. http://twitpic.com/35lk9

With a stop at Friday's low, I am looking to remount APA. I will not chase. http://twitpic.com/35lpl

BA was knocking on death's door, but now is breaking out. I want in. http://twitpic.com/35lui

Have you noticed the stealth rally in Solar? STP has good risk reward with stop here. http://twitpic.com/35lz6

Per Request:

GE: http://twitpic.com/35mas

SLX: http://twitpic.com/35mer It's a battle ground. I have found easier trades.

See the IYR in regards to SRS. If IYR break fails, I'll look back at SRS until then not for me.

Rather than AEM how about GLD. http://twitpic.com/35mk2

Love the semis as noted in previous brunches. I am long SMH http://twitpic.com/35mn6

KR: This one I have been watching for short entry off weekly for some time. http://twitpic.com/35mpp

ADM - I think it important to highlight a short I am watching. http://twitpic.com/35noj

OK, I think I got all stocks in the cue. Let's knock out a mystery chart. Love this one. Thoughts on Mystery Chart for this week? http://twitpic.com/35n1f

BTU it is. One of the most anxiety filled stocks around right now. As you can clearly see, BTU is in a channel the is well defined. I suspect a break is coming soon, after much heartache. This break could be up, or down, but either way, I will play it and suspect it has a long way to go.