Sunday, March 21, 2010

DIN long

Date entry: 12-FEB-10

Trade: Long DIN Jun 2010 $25 Calls - 2 contracts at $5.50 each, added to position on 18-FEB-10 2 more contracts at $5.30 each

Profits taken: 4-MAR-10 2 contracts sold for $8.60 each, 16-MAR-10, sold 1 more for $11.10...keeping last one on until %R sell signal is reached.

Set-up: 11 -FEB-10 %R and accel band firing at same time. Added to position on %R retest...retest occured outside of bands. DIN didn't close inside bands during retest. DIN is in a strong group.

Conditions: Efficiency Ratio, Stochastics, ADX/DMI are all very bullish..

Exit strategy: %R sell signal

Time Frame: Prepared holding months.

Where found: Stocks on the move

Emotions:
Best trade of the year for me hands down so far. I got in on this ealry in the February rally. I noticed that the restaurants as a group were moving and many had reported stellar earnings. DIN had yet a few weeks to report earnings. It also had a long base forming and the breakout put it above the accel bands and above a trendline of resistance on a longer term scale.

Either case, it retested, but never closed inside the accel band, I added to the position at that point. I have since gotten more than a double and am riding the last contract until a %R sell signal is in place. this has been outside the accel bands for over 1 month and a half at the time I am writing this.

Daily Chart below.


EZPW long

Date entry: 17-MAR-10

Trade: Long EZPW APR 2010 $20 Calls - 10 contracts at $1.55 each

Set-up:  16-Mar-10 %R retest...retest inside bands...near 20 day MA...big volume on retest.

Conditions: Efficiency Ratio, Stochastics, ADX/DMI are all very bullish..

Re-Entry: none.

Exit strategy: 20.12 is violated on daily chart.

Target for profit taking: Sell entire position at 75% profit.

Time Frame: Prepared holding 3 weeks.

Where found: Stocks on the move

Emotions:

EZPW is a strong IBD stock since entering the trade it has not rebounded nicely, and the %R has not gone back above overbought, this isn't a very clean retest and I may remove the trade in lieu of other opportunities.

Also the retest occured well inside the accel bands and this is also sub-optimal according to new learning from Price Headley.

Daily and Hourly Chart below.



CTXS Long

Date entry: 19-MAR-10

Trade: Long CTXS Jun 2010 $45 Calls - 2 contracts at $4.90 each

Set-up:  16-Mar-10 %R retest...NOT A TRUE RETEST...since %R was only 79.81

Conditions: Efficiency Ratio, Stochastics, ADX/DMI are all very bullish..

Re-Entry: none.

Exit strategy: 46.97 is violated on daily chart.

Target for profit taking: Sell entire position at 75% profit.

Time Frame: Prepared holding 3 weeks.

Where found: Stocks on the move

Emotions:

After watching a webcast with Price Headley, he said that he likes to get in ONLY on %R retests and mostly those that occur outside of the accel bands. In this case, the stock closed inside the bands, but only barely...and it rebounded nicely the day I got in.

However, this was not a true %R retest...but because it was close enough and it happened nearly outside the accel bands, I decided to take the trade. CTXS is also very solid fundamentally.

This so far is working out realy well as it bounced right away. The stock is in a very strong group and has solid fundamentals...the uptrend has been in place and is also strong.

Daily and Hourly Chart below.



ROST long

Date entry: 19-MAR-10

Trade: Long ROST Apr 2010 $52.50 Calls - 10 contracts at $1.85 each

Set-up:  18-Mar-10 %R retest.

Conditions: Efficiency Ratio, Stochastics, ADX/DMI are all very bullish..

Re-Entry: none.

Exit strategy: 51.82 is violated on daily chart.

Target for profit taking: Sell entire position at 75% profit.

Stop loss: close below $51.82 (%R retest bar's low)

Time Frame: Prepared holding 3 weeks.

Where found: Stocks on the move

Emotions:

After watching a webcast with Price Headley, he said that he likes to get in ONLY on %R retests and mostly those that occur outside of the accel bands. In this case, the stock closed inside the bands, but only barely...and it rebounded nicely the day I got in.


This so far is working out realy well as it bounced right away. The stock is in a very strong group and has solid fundamentals...the uptrend has been in place and is also strong.

Daily and Hourly Chart below.

VLTR long

Date entry: 16-MAR-10

Trade: Long VLTR with Apr 2010 $22.50 Calls - 10 contracts at $2 each

Set-up:  15-Mar-10 %R retest entry point. %R inside bands

Conditions: Efficiency Ratio, Stochastics, ADX/DMI are all very bullish..

Re-Entry: none.

Exit strategy: 22.40 is violated on daily chart.

Target for profit taking: Sell entire position at 50% profit

Current Stop loss: close below $24.03 (accel band set up bar's low).

Time Frame: Prepared holding for 3 weeks

Where found: Stocks on the move.

Emotions:
I did this trade based on %R retest, the retest is inside the accel bands. I just got off a webchat with Price Headley in which he said the best stocks retest outside the accel bands. This position nearly doubled overnight. I had a standing GTC order to cancel at $4.10 per contract. It did not fire. The stock reversed and

I did not take any profits.


I have learned a valueable lesson with this stock. I think I will be simply much more nimble and perhaps not hold onto positions for as long as I do. Just take the entire positions off at 50% and move onto the next opportunity, there are tons of opportunities I find and I nearly always have something else to rotate into.

I can also put in GTC orders for selling positions at 75% profits...I see those situations quite often as well.
I can't not take money off the table, waiting for something to materialize. Also, if I see a double and dont take it, then it is my fault for not then settling for 75% winner...There are lots of things that turn into this situation and sure there are always the runaways like DIN...but it is simply better to keep trading the big moves as they are happening than holding onto things waiting for them to move.


I have to really think through my trading plan as this week this stock gave my entire world a roller coaster ride. I had seen a lot of money on wednesday only to return to baseline by Friday. This is unacceptable.


When I am right and I see that kind of money just take the trade off. No sense in being greedy because there are lots of other opportunities that will do the same thing for me.

Also will only start considering retests that happen outside the accel bands or just barely inside (retest bar closes inside)

Daily and weekly Charts below.

Friday, March 12, 2010

RIMM long via spread

Date entry: 12-MAR-10

Trade: Long RIMM with a debit spread Apr 2010 $75/70 Bull Call spread - 5 contracts at $3 each

Set-up:  11-Mar-10 accel band set up confirmed on daily chart. %R has confirmed and had 2 retests prior to the accel band set up.

Conditions: Efficiency Ratio, Stochastics, ADX/DMI are all very bullish..

Re-Entry: none.

Exit strategy: 73.85 is violated on daily chart.

Target for profit taking: Sell entire position at $750 profit.

Stop loss: close below $73.85 (accel band set up bar's low).

Time Frame: Prepared holding through April 2010 Expiration.

Where found: Just checking into RIMM

Emotions:

I am actually quite confident in this trade. It is a well crafted trade. The breakeven point at expiration is lower than the current stop in place based on Accel band setup. The trend has been in place on %R for a little while now and it has just confirmed an acceleration of that trend. There is a gap from September where the target for RIMM filling that gap is $82.72.

I crafted this as a spread because implied volatility is high on RIMM right now and I wanted a cheaper way to go long. This is a 3:2 risk vs. reward scenario and I am protected on my top strike as RIMM is currently above $75...but I am further protected because of my breakeven point at expiration is lower than my current stop.

The stock gave me a good entry on the hourly chart because it had a %R retest, so I was using that as a guide.

In the retirement accounts I went long some calls based on this acceleration. Those are being guided by the daily chart and they are following standard exit rules based on %R stop loss or the current stop whichever comes first.

Daily and Hourly Charts below.



Thursday, March 11, 2010

KIRK long Update

UPDATE: Took profits on 17-MAR-10 sold 3 contracts for $4.40 each...a double! Current holding's cost basis is now $1.22 per contract

Date entry: 11-MAR-10

Trade: Long KIRK Apr 2010 $17.50 Calls - 5 contracts at $2.15 each

Set-up:  8-Mar-10 set up confirmed on daily chart on %R and accel bands.

Confirmation on Accel band on 8-MAR-10 (%R had been confirmed 4-MAR-10)

Conditions: Efficiency Ratio, Stochastics, ADX/DMI are all very bullish..%R has violated...stock is in top IBD group

Re-Entry: %R retest

Exit strategy: 18.38 is violated on daily chart.

Target for profit taking: Sell entire position at $500 profit.

Stop loss: close below $18.38 (latest %R Retest bar's low).

Time Frame: Prepared for 1 month  holding period.

Where found: IBD stocks on the move

Emotions:

KIRK is top rated in a top group on IBD. It is reporting earnings tomorrow 12-MAR-10...this is scary, but the Imp vol is less than 2x historical volatility...so this is within my rules. KIRK has a true retest outside of the accel bands, it was violated for 2 days now...but efficiency ratio is still bullish.

Volume is high today and it is moving again outside of Accel bands and %R is overbought again. more bullishness. I think the %R violation is a fakeout and that this is setting up for a big move post earnings.

Stock is near a 52 week high which it posted the day of the reversal and 1st %R retest. My stop is based on the 2nd retest day's low.

Long GR - Update

UPDATE:  Exited GR calls at $2.75 each for $25 loss. GR broke hourly stop of $71.50 early in the day and traded around it all day. It recovered a bit but, rules are rules. Market is at cross roads and I am trying to reduce long exposure in case the rally tuckers out...which is what it appears to be doing....lots of signs pointing to a top...Still looking into potentially using daily close as the basis for triggering hourly stops...as this would have probably kept me in GR...a strong stock...with a so-so volume day...

Date entry: 5-MAR-10

Trade: Long GR Mar 2010 $70 Calls - 10 contracts at $1.15 each,...added another 10 at 0.85...got out then added 5 April $70 calls for $2.80

Set-up:  5-Mar-10 set up on Hourly chart on %R and accel bands.

Confirmation on Accel band on 2-MAR-10 at 10 AM (%R had been confirmed for a while already)

Conditions: Efficiency Ratio, Stochastics, MACD, and ADX/DMI are all very bullish

Re-Entry: 2:45PM  %R retest

Exit strategy: 1st if  69.23 is violated on hourly chart.

Target for profit taking: Sell entire position at $500 profit.

Stop loss: close below $70.92 (latest %R Retest bar's low).

Time Frame: Prepared for 2 weeks  holding period.

Where found: Sizzle index

Emotions:

This was very difficult as GR has been in an uptrend for a few days..with no retests on the daily chart and very few retests on the hourly chart. The news is that they would be presenting at a JPM and GS aerospace conferences .

This is in essence a short term trading not necessarily a day trade but very short term. Also these are closer to being at the money rather than very deeper in the money. Also this is a March expiration with only 10 trading days left a the time of execution.


I did not follow my exit rules when they were violated on Monday 8-MAR-10. I did not cut loose because I thought volume was low, and the daily chart still showed bullish confirmations. And I was only out of the money by a few cents...This was not good. I was looking at a near 50% loss on the position.

Tuesday 9-MAR-10, stock moves higher and the market was rallying hard....bringing back all my loss I did not take any profits. Towards the end of the day the market stopped rallying and reversed...I hit my break even point and I exited the trade...at this point I was following a new stop based on a %R retest...and it was violated...so I followed the rules this time.

Wednesday 10-MAR-10 stock gaps up. Go figure. rallys most of the day then at the end it gives a false retest of 79.69 on %R...I picked up 5 April $70 calls for 2.80. GS added the stock to the conviction buy list.

Thursday 11-MAR-10 stock gives a true retest in the first hour of trading, but I did not add to the position. The market is getting tighter and opened lower today...jobless claims came in flat...volume is weak and the rally looks tired...VIX is hitting 19 today.

I am looking for a double at this point...GR continues to be strong.

Long HAS - Update

UPDATE:  Exited HAS at $2.70 per contract - $75 loss. HAS broke tightened stop of $37.76 on hourly chart on a gap down in heavy volume. Recovered a bit as day progressed but still closed under 37.76.

Date entry: 10-MAR-10

Trade: Long HAS April 2010 $35 Puts - 5 contracts at $2.85 each,...

Set-up:  10-Mar-10 set up on Hourly chart on %R retest.

Confirmation on both Accel band and %R on 2-MAR-10 at 10 AM

Conditions: Efficiency Ratio, Stochastics, MACD, and ADX/DMI are all very bullish

Re-Entry: none

Exit strategy: if 37.48 is violated on hourly chart.

Target for profit taking: when position reaches $500 profit

Stop loss: close below $37.48 (%R Retest bar's low).

Time Frame: Prepared for 2 weeks  holding period.

Where found: Sizzle index

Current P/L: $200

Emotions:

This was very difficult as HAS has been in an uptrend for a few weeks..with no retests on the daily chart and very few retests on the hourly chart. No news. This is in essence a short term trading not necessarily a day trade but very short term. Also these are closer to being at the money rather than very deeper in the money.

Wednesday, March 3, 2010

Added to WCG Short - Updated

UPDATE: WCG closed at 29.89, Exited position for $1.45/ contract... loss of $1.80 per contract on an average basis...$1080 loss on 6 contracts on IRAs, and , $900 on 5 contracts in Erin Roth.

Trade: Long WCG April 2010 $30 Puts - 3 more contracts at $2.00 each, overall cost basis per contract now $3.25 (total position 6 contracts)...WCG was trading at $29.29 high reached 29.76...this is within 1.6% of retest high.

Set-up:  18-Feb-10 set up on Daily chart on both 20D Accel bands and 30D $R.
Confirmation on both Accel band and %R on 19-FEB-10.

Conditions: Efficiency Ratio, Stochastics, MACD, and ADX/DMI are all very bearish.

Re-Entry: %R retest on 3-MAR-10...High of day is $29.76

Exit strategy: if 29.76 is violated.

Target for profit taking: when position reaches 50% profitability.

Stop loss: close above $29.76(%R Retest bar's high).

Time Frame: Prepared for 1 month+  holding period.

Where found: IBD Stocks on the move

Current P/L: -$705

Emotions:

This was very difficult as WCG is now within the accel bands and this is the 3rd up day in a row. The company got an upgrade today and was called an acquisition target by Stifel Niclaus. Regardless I put the trade on based on %R retest rules. The stock gapped up and seemed to fade back down. It could be retesting the high of the setup bar, and the gap should be resistance.

Stochastics, Efficiency Ratio have also retested now.  ADX remains above 40.





Added to Short MON

Trade: Long MON April 2010 $75 Puts - 2 more contracts at $3.85 each, overall cost basis per contract now $4.82 (total position 4 contracts)...MON was trading at $73.45 high reached 73.93...this is well within 1% of retest high.

Set-up:  25-Feb-10 set up on Daily chart on both 20D Accel bands and 30D $R.
Confirmation on both Accel band and %R on 2/26/10.

Conditions: Efficiency Ratio, Stochastics, MACD, and ADX/DMI are all very bearish.

Re-Entry: %R retest on 3-MAR-10...High of day is $74.55

Exit strategy: if 74.55 is violated.

Target for profit taking: if MON closes at or below 66.11 take 50% of position off.
This is 78.6% Fib extension from 1/6 peak to 2/5 low to 2/22 peak. Also 52 week low resistance level.

Stop loss: close above $73.30 (set-up bar's high).

Time Frame: Prepared for 1 month+  holding period.

Where found: IBD Stocks on the move Sunday 2/28/10.

Current P/L: -$470

Emotions:

This was very difficult as MON is now within the accel bands and this is the second up day in a row. The company got approval in Europe for selling 4 types of GM seeds. It seems to have bounced off the 50% fib extension...Regardless I put the trade on based on %R retest rules.

Stochastics, Efficiency Ratio have also retested now.  ADX remains above 40.




Monday, March 1, 2010

Short MON

Trade: Long MON April 2010 $75 Puts - 2 contracts at $5.80 each

Set-up:  25-Feb-10 set up on Daily chart on both 20D Accel bands and 30D $R.
Confirmation on both Accel band and %R on 2/26/10.

Conditions: Efficiency Ratio, Stochastics, MACD, and ADX/DMI are all very bearish.

Re-Entry: on %R retest

Exit strategy: if %R retest is violated.

Target for profit taking: if MON closes at or below 66.11 take 50% of position off.
This is 78.6% Fib extension from 1/6 peak to 2/5 low to 2/22 peak. Also 52 week low resistance level.

Stop loss: close above $73.30 (set-up bar's high).

Time Frame: Prepared for 1 month+  holding period.

Where found: IBD Stocks on the move Sunday 2/28/10.

Emotions:

Found this and decided to open a 10% position based on the strong technicals on various timeframes. The fears on this one are that it is close to a 52 week low and the fundamentals on the company are not bad. In fact they aren't terrible at all. The weekly chart shows a trading range, and I am entering near the bottom of that range. So the downside may be limited on this short. The vix is under 20 and the market is failing to follow through on a rally attempt that started on 2/5/10. Today however, it is finding a lot of buying (its Monday and this is a pattern that appears to be a mutual fund phenomenon of late - They call this Mutual fund Monday).

In any case, my current folio is Long, DIN, RVBD, NFLX, and UUP. I am short WCG, and FLIR. I wanted more short exposure since the rally attempt is getting long in the tooth and the VIX is low. So that is why I picked up MON. The major risk is that value guys come in a pick it up at these levels and some upgrades ensue. The headlines for MON are negative, Round-up (their key product) seems to have more and more resistant strains of weeds, and the CFO recently re-iterated guidance for 2010 EPS that were low compared to the street (3.10-3.30 range vs. 3.29 expectations). This may have exasperated the selling.