Market Speculator Part-Time & Swing Trade Report

Paul
Singh
October 9, 2014
How to trade stocksbows-opengraphTrading-Watch-List

Quick Summary:

Yet another SPY reversal, this time with a bullish engulfing pattern. Key is break of the 50 dma. Took profits in shorts $BITA and $GS. Entered long $TKMR, $PANW and $DIG.

Video Analysis:

Today's intra-day analysis went over $SPY, the $GS and $BITA trades and focus list stocks.

Key SPY Pivot Levels: Round number $200, Old high 201-202, 50 dma 197.01, 100dma 195.12 , gap 193 pivot lows 190-191

SPY 10-8-14

Under the Hood and Trading Game Plan:

As traders we must be quick to adapt. Nothing is set in stone. Yesterday I talked about the clear signal we received for a retest of the August lows, and here we are today with a new signal. In the intra-day video I talked about not expecting the Fed minutes to make a huge difference--possibly a small spike that could last a few days, but nothing that changes our bias. Then bam, we get another big signal. This time it's an engulfing pattern, as today's candle completely envelops yesterdays. What do we do when something like this happens? We adapt.

I closed out the remainder of the $BITA short (after taking profits in $GS and half $BITA earlier in the day) and started searching for good bounce candidates at the close. I did not stubbornly stick to my original plan, which is a huge leak in many traders strategy. You must be able and willing to adapt.

Now we must watch the 50 dma, and to a lesser extent, the 20 dma. If these levels get remounted, we could be seeing the end of the dip and a resumption of trend.

My current game plan is to play this bounce on a short term frame and re-assess as the market gives clues.

Current Trades

Today I covered the $BITA and $GS shorts for nice gains.

Some nice hammers formed at the close and I entered three of them. I expect that today's late day strength will at least carry over to a morning bounce. $TKMR and $PANW are very similar setups--strong price patterns with a pullback that violated major support, and hammers the closed above the support. I would have liked to see more volume on PANW, but the price action is so good that I went with it anyway. As noted in the trade alert, TKMR is a risky and volatile play on ebola. It's a trade I might not usually make, but the pattern was so good that I took the trade. $DIG formed a strong hammer (high volume) and should pop tomorrow.

Stops and targets are difficult to address right now because I will assess targets at the open. A good spot to place stops is in the middle of today's price action below the hammer portion of the candle--DIG $66.50-66.75 TKMR $21.80 PANW $99.

DIG

DIG 10-8-14

PANW

PANW 10-8-14

TKMR

TKMR 10-8-14

The Trade Results Journal/Spreadsheet is up to date

The Focus List

For now, say goodbye to those inverse ETFs I posted yesterday. I am doing a review of my watch list and will post ideas tomorrow pre-market via email alert. Personally, with three long trades in place, I am not likely to add positions.

Market Leaders

Some strong bounces as with the market. GOOGL's range trades (buy bottom, sell top) have worked well. $TSLA's lack of movement has to be a concern.

market leaders 10-8-14

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.

New subscribers and trial members please leave me any feedback/comments in the comments, via email (singhjd1@aol.com) or twitter (twitter.com/PaulJSingh).

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