Wednesday, December 19th Recap
Well another 1% day today in the SPYs today, as the bulls are taking the market by force as of late. As we are at the top of ourbroadening formation, I think it is obvious that we have reached over bought levels. However, I think at this point it is to the point where we buy any dip into support. When we reach levels this high in our broadening formation and do not fail, it is highly probable that we find a new apex sometime soon - when we begin a new base and "back and fill," and new broadening formations are made. For now, it is VERY hard to initiate new positions, as SO many stocks are overbought as of late. As we said yesterday, find the stocks that are basing well, flagging, and are still moving on high volume. Do not chase the winners at this point in the game!
If you are not watching the financial sector this week, you have not maximized your profit potential. The banks (namely XLF andFAS) are absolutely fantastic and will be in the weeks to come. I will buy buying FAS, and buying LOTS of it, on the next pull back. I still think FAS is the stock to trade in the next month, and the next buy-back area for me is the 116-118 area. Yet again BAC, C,WFC, and GS lead the way for the financials. I'd like to say the the rally has reached overbought areas that are not prime for buying yet, but I thought that yesterday as well. Trade your positions with specific stops in place, and I guarantee the banks make you a hefty return in the next month.
Other stocks that hit our buy points from yesterday were AMZN, LNKD, LULU (closed at highs), FB, CRM, GMCR, and XHB (just to name a few!).
A couple great things that I saw today that proved to me the market wants higher: XHB's followed through yesterday's move on even more strength today, and the XLU's held the 200-day and pushed MUCH higher.
At this point in the game I am looking for stocks that are "laggards" but also GREAT (not good) setups. Some stocks like AAPL,ARNA, MNST, FB, and MCD fit this description. I do like how AAPL closed today, at highs and above the 8-day. It seems like a test of 550 is HIGHLY probable this week. In addition, it appears that the casinos have not fully participated in this rally, but also want much higher. Stocks like MGM, LVS, and WYNN just need volume and we'll see VERY SOLID days ahead. I think MGM and WYNN are my two favorite setups in the casino sector going into Wednesday.
In high beta world, GOOG and PCLN killed it today (as well as AMZN mentioned earlier). If you get the chance to get GOOG at the 706-710 area it's a DEFINITE buy. Priceline has been battered and bruised coming into today, but never really got completely demolished (like AAPL). It's good to see it close above the 8-day, and I think we see a move to 640 very soon. Any new positions should be against the 8-day.
Overall, the market is showing great action across the board. Volume and price action are perfectly consistent and it's a day traders paradise. The only thing you MUST focus on is trading the BEST setups out there. The best stocks and the best setups are very easy to read right now, and gambling on stocks that aren't performing is not the best way to make money! End of story.
If you are not watching the financial sector this week, you have not maximized your profit potential. The banks (namely XLF andFAS) are absolutely fantastic and will be in the weeks to come. I will buy buying FAS, and buying LOTS of it, on the next pull back. I still think FAS is the stock to trade in the next month, and the next buy-back area for me is the 116-118 area. Yet again BAC, C,WFC, and GS lead the way for the financials. I'd like to say the the rally has reached overbought areas that are not prime for buying yet, but I thought that yesterday as well. Trade your positions with specific stops in place, and I guarantee the banks make you a hefty return in the next month.
Other stocks that hit our buy points from yesterday were AMZN, LNKD, LULU (closed at highs), FB, CRM, GMCR, and XHB (just to name a few!).
A couple great things that I saw today that proved to me the market wants higher: XHB's followed through yesterday's move on even more strength today, and the XLU's held the 200-day and pushed MUCH higher.
At this point in the game I am looking for stocks that are "laggards" but also GREAT (not good) setups. Some stocks like AAPL,ARNA, MNST, FB, and MCD fit this description. I do like how AAPL closed today, at highs and above the 8-day. It seems like a test of 550 is HIGHLY probable this week. In addition, it appears that the casinos have not fully participated in this rally, but also want much higher. Stocks like MGM, LVS, and WYNN just need volume and we'll see VERY SOLID days ahead. I think MGM and WYNN are my two favorite setups in the casino sector going into Wednesday.
In high beta world, GOOG and PCLN killed it today (as well as AMZN mentioned earlier). If you get the chance to get GOOG at the 706-710 area it's a DEFINITE buy. Priceline has been battered and bruised coming into today, but never really got completely demolished (like AAPL). It's good to see it close above the 8-day, and I think we see a move to 640 very soon. Any new positions should be against the 8-day.
Overall, the market is showing great action across the board. Volume and price action are perfectly consistent and it's a day traders paradise. The only thing you MUST focus on is trading the BEST setups out there. The best stocks and the best setups are very easy to read right now, and gambling on stocks that aren't performing is not the best way to make money! End of story.