Note: I am going to start incorporating video content within the Reports. Any comments or suggestions are appreciated. This was the first rudimentary test video.
Key SPY Pivot Levels: 199 : recent old high, 197. 33 dma, 194.47: 50 dma
Under the Hood and Trading Game Plan:
SPY broke below the 20 dma moving average on slightly stronger than average volume. We still have a negative RSI divergence, negative volume and price action. While we are getting some earnings breakouts, overall individual stocks are not breaking out in high numbers which suggest a new high breakout that leads to a strong trend is not coming. Shorter term, let’s see if dip buyers come in tomorrow.
My bias is now slightly bearish and I will consider shorting SPY on strength, especially if the $198-199 gap gets filled. I will likely use inverse leveraged ETF SPXU. With inverse ETFs, you enter long in order to short the underlying equity. If you are short SPY, you can do it by going long SPXU.
IWM is still bearish. As with SPY, I like it on gap fill in the $114.25-114.75 range. I will look to short strength via inverse leveraged ETF SRTY.
I am still looking for long setups in momo stocks and earnings related setups that have pulled back are ready to bounce, and developing short setups. My focus for shorts early in the week will be market inverse leverage ETFs SPXU and SRTY.
I received lots of questions about GWPH today. Many of you took this trade and wanted to know if I was taking profits early. I am not. My target is still the gap fill area around $95. I expect there will be some back and forth on the way to the target, as it’s rare that targets are hit with a straight line. I will be patient and see how it plays out.
I am still holding GMCR. It came within cents of hitting my target today, then completely reversed and ended up flat.
The Trade Journal results
The Focus List
Not including the earnings breakout list, I have shortened the focus list to start the week with recognizable momo stocks and one earnings pullback. All pullback entries are negated if market or stock tanks on high volume.
I am revamping the focus list a bit mid-week. GWPH is too far from entry now that it has moved up 6 points. BWLD reacted poorly to positive earnings results after hours, so it’s off for now. GMCR is still there, but I imagine if one was going to enter they already would have. YY needs to pullback about 3 points for entry. It is a volatile stock, so this is very possible in the next day or two. INO is at entry level.
WYNN posted strong earnings and has broke out near $220, which is a strong resistance level. This will be the third attempt to breakout during the 4 month range. Considering there is now an earnings catalyst, it should happen now if it is going to happen. Entry on breakout of $220, or on pullback in anticipation of an eventual breakout. If entry is on breakout between $220-223, stop should be around $217-218 with targets anywhere from $230-245. This is a wide range for target and is dependent on post breakout price action.
VEEV has formed a trading range at the to of the original breakout bar. This is a type of “high and tight flag” setup. The bottom of the range is converging with the 50 dma. Entry beetwen $23-23.50. Stop $22.50. Target near $26.
GRMN is off the table since it reports tomorrow. MSM broke down below trading range as SDRL did the day before. The three of these setups are shortable on strength up to resistance levels as discussed in previous reports.
Earnings Season Breakouts Watchlist:
During earnings season I keep an eye on breakouts. These are not necessarily focus list stocks that are near entry levels now, but I keep a breakout list and over the days and weeks ahead, I watch for good pullback or post break consolidation entries. I have included all 15 breakouts that I am watching for those who like to monitor this type of stuff. For most of these, I am looking for pullbacks either to the bottom of the breakout bar or gap fill.
SPNC is near an entry at $25-50-26 with a stop at $24.90 and target at $28. Deck could be forming the bottom of a post breakout trading range.
These are stocks that I always watch, though they might not be in my tradeable watchlist, nor are they actually always leading the market.
Not much changed accept Z starting a pullback off it’s amazing two day run up. I am watching for a good entry.
Please read the post 23 Laws of the Part Time Swing Trading the Market Speculator Way and How to Anayze Your Swing Trade Results It is important to know these rules if you trade off the Report.
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