Wednesday, November 18, 2009

UUP with Ben!

Ok, ok... so I'm not a whiz with Photoshop; you get the point. It's after 2 AM and I finally finished the image I had in my head this weekend.

I've noticed other traders are talking about throwing their hands up in disbelief in this rally. We all know it's tied to the dollar, and all the money that's getting conjured up and thrown into Treasuries. I've been in and out of UUP and some other small stocks that I was watching for patterns, like KKD.

Speaking of which, WTF happened with KKD today? I sold in the panic this morning, as it dropped lower and held it for most of the day. Then, in the afternoon it took off and closed higher for the day. Sheesh!

Update: I'm out of KKD, still riding HW, and now have a spot of TIV. I was thinking of getting back into UUP, but that ticker moves so slow that it would probably be better to find some other vehicle to ride any kind of dollar comeback. Then again, I might have a while to look for one if this death-defying rally continues.

I heard an interview with Tom McClellan of the McClellan Oscillator Clan, on The Disciplined Trader podcast. I liked what both of the guests said that I listened to the show twice. But the reason I bring it up now is because Tom McClellan mentioned that he forecasts a dip in the US markets through much of December. He even went so far as to say that we might go back to screaming 'doom & gloom' before it bottoms, even though it won't go farther down than maybe what it was in July. So, I'll be keeping that in mind for the next month or so.

Alright, gotta go to work in a few hours, time for some sleep.

Thursday, November 12, 2009

Power UUP

Looks like the Dollar is trying to make a comeback en force. Today's move bounced it off the 20MA and punched through the 50MA. Last time, it was stopped by the 100MA, which now stands at 23.12. Rising past this barrier and continuing on may spell doom for the local markets as long as the Dollar-Stock Market inverse relationship continues.

But if it does go though, I'll be interested in learning the reasons why. I've been hearing a lot of noise about a Dollar carry trade, which could make dollars 'worth' more. But that didn't really seem to work for Japan. Then again, we're not Japan.... read it how you like.

On a tip from the ChartAddict I bought some PLA today.

I had actually been watching this one as it was forming a nice Holy Grail setup, easing back down to the 144MA. But I didn't check back in time, and I got in at 4.00. Right now, I'm losing in the aftermarket, and I found out later that the jump was due to news that Playboy might get bought out. This was a rumor play, and I might have moved in too late. Support is at 3.82, so that's where I'll start to sweat. Otherwise, I'm going to see how this 'plays' out.

I dumped GSX at .48, and I might have to wait until December to see if it will bottom out. Trendline support is still only around .45 or so, but that's a healthy 7% for this penny pincher!

I also might include a short of the Dollar/Yen through the FXY etf. Don't know if I'll be able to short that etf until I try, and I'm still watching for a few more weeks as it approaches resistance. The wedge it's riding in now has such a low slope, it might not be until January or almost February before the Yen falls. Say, is there a Euro/Yen etf out there for us to buy?

Wednesday, November 11, 2009

Modern Warfare 2 Released, Volume Low. Coincidence?

We don't have an XBox, and I surely can't afford $80 for COD6:MW2. So, I have time to work out some more trading techniques.

I've been starting with the weekly charts to find patterns, since my schedule prevents me from trading more frequently than daily. I've stuck my toe in the water with the following four tickers, and the charts are shown daily for a little more clarity.


Boy, looks like I'm bucking the trend on this one. But I've thrown a little fundamental assumptions into this, since it's a Dollar Index follower. I jumped-in following the break in trend on good volume last week. I later found through ZeroHedge that the big spike might have been limited insider trading, and not actual capitulation. Notice that UDN didn't move in tandem, and only UUP was announcing more share issues.

Nevertheless, UUP is still fighting support at this time. There is one heck of a lot of noise on which way the Dollar is going to go from here, and most of it is bearish. So, I have my doubts, but I'm trying to make a point of ignoring the noise more and more, and just watching the charts. For now, I'm holding out and ready to pull the plug. One thing that gives me hope is that yesterday's candle sure looks suspiciously like a stop-sweep...which are often followed by swift moves in the opposite direction. But I've only found those intraday before.


I was so excited when Krispy Kreme went IPO about 10 years ago... it was around $18 and I wasn't even trading stocks yet then. It closed at $3.39 today and hasn't ever split. I remember thinking about how a share was only a dollar back in March, and wondering how many shares I could get for the price of a dozen "hot doughnuts now."

This chart shows a nice and steady uptrend that might also be a rising wedge. As long as this trend holds I'll keep confident all the way up to 4.38... where I'll keep holding through the 4th attempt to break support. From the first test on resistance, this chart actually looks like a cup and saucer formation brewing.


Headwaters, I don't even know what they do. But this chart shows another rising wedge squeezed near the end, looking to break out. It appears that I may have jumped in a bit early, as there's more downside risk in this narrow range at the tip of the wedge. It also might be a failed pattern since resistance was broken for several days in October, but then failed to become support. This stock may be entering a new trend, but I've put my money in that this could be a bull-flag and the main trend will continue. There's low tolerance if this trend gets broken, however.


I bought Gasco thinking we might have a Holy Grail pattern off the 51 MA, and that's when I got in. Unfortunately, the 51 MA has been broken and I have to count on the upward trend holding out. This is a penny stock, so moves either way could be severe. Keep the safeties off.