Quick Summary:
SPY is overbought and nearing a good level to take a short stab. Focus list stocks to start the week are: NFLX, EQM, FB, FSLR, GMCR, LNKD, RDNT, TSLA, TWTR, YELP, YY. ETF DUG is oversold and close to entry. Exited YELP on Friday for a big gain, and partially exited CSIQ. Still holding WOOF, FB and new entry LNKD.
The Market
Key Pivot Levels: 196.48: new high resistance 189.76: 50 day moving average 181.31: recent low 181-184:
Under the Hood:
Friday we added bollinger bands to the chart in order to analyze a possible short setup. Now we see that stochastics are extremely overbought and look like they could turn over. We also have a short term RSI divergence that has formed. RSI at the new high is lower than at the previous high on June 9th. If price moves toward $197, I will look to short SPY or enter SDS long (the inverse ETF).
Trading Game Plan:
Possible SPY short.Focus list stocks can be played according to setup without regard for the market.
Current Trades
Friday I exited half my position in CSIQ for a profit and moved my stop up to entry level. This was before my target because I am concerned about the overbought market.
I entered 150 shares of LNKD at an average price of $163.97, with a stop at $158.50 and target at $180. This gives me a 3:1 reward to risk ratio.
I am still holding WOOF and FB.
Here is the Trade Journal with current open and past closed positions. Note that FB and CSIQ have not been updated on the spreadsheet
The Focus List
The Watchlist has 11 stocks to start the week. I have decided to start the week with a slightly bigger focus list, and trim and add to it as the week goes on. This should give a balance for those of you that want a small focus list and those that want a bigger one.
A base seems to be forming in NFLX, and the 20dma is moving up towards this base. Entry zone is around $430, with a stop at $419 and initial target at $460. This gives us an almost 3:1 reward to risk ratio.
EQM is forming a range under $100 round number resistance. The long tail as it tried to breakout on Friday suggests a pullback. Entry level is between $90-93. Stop at $87. Target is $100+.
FB is holding the recent breakout. Entry in the $63.50-64.25 range, with a stop at $61.75 and target at $66 and $70.
FSLR did not participate with some other solar stocks on Friday, like our own CSIQ. If it pulls back, we'll have a great entry around $65-66. Stop at $64 and targets at $70 and $75.
GMCR tried to breakout out of the trading range but pulled back into it. Entry at 20 dma around $117.50, with stop at $115 and initial target $125. This stock could pullback the bottom of the trading range and take out stops. If that happens, there is a possible re-entry at $110-113.
LNKD entry is still available on pullback to those that did not enter Friday.
The breakout, high tight flag pattern has been working for RDNT. Entry around here, with a stop at $6.50 and initial target at $9. The volume pattern is fantastic.
TSLA is forming a post breakout high tight flag pattern. Entry can be made within this range with a tight stop around $224. Target is $260 old high. The stock could pullback to the previous range at $211-213. That would provide another entry if stopped out or just waiting for a deeper pullback.
TWTR is holding the 50 dma break and has a nice volume pattern. Entry on pullback with targets at $45, $55 and $65.
I will look to re-enter YELP on a pullback to $72. This is another stock with a nearby support level that could stop out the trade. If the stock does gapfill, another entry at $68, with is strong with both price and gapfill support.
YY is right at entry level post breakout, with a stop at $66 and target at $77.50 and all the way up to $90.
Sector and International ETFs
DUG continues to become extemely oversold (as DIG and USO become overbought). I will likely enter if it reaches $36.
Please read the post 23 Laws of the Part Time Swing Trading the Market Speculator Way. It is important that you know these rules if you trade off the Report.
New subscribers and trial members please leave me any feedback/comments in the comments, via email (singhjd1@aol.com) or twitter (twitter.com/PaulJSingh)
