Quick Summary:
All indexes close strong after getting hit hard. Hammers form in $SPY, $QQQ and $DIG.
Video Analysis:
No video today.
Current Trades
Today I entered and was stopped out of $SPXL and $MNST intraday for small losses.$TQQQ (leveraged $QQQ) long today as a bounce setup and took half profits. Stop has been moved to entry to lock in gains. Entry was at $66.80 and close was near $70.10$DIG (leveraged $XLE) near the close based on oversold hammer pattern (entry $57.05).I am still holding $TKMR which is slightly above my entry (entry $23.80).The format is a bit different today since we have ditched the regular focus list and are only focusing on 6 index/sector charts. We are watching key levels to get long for a bounce play on each of these six charts. Near term I am now keying in on 3 charts, $SPY, $QQQ and $DIG. While $IWM and $SMH still worth watching, the charts for the 3 chosen are "cleaner" and easier to trade from.DIG formed a hammer, reversing strong from lows of the day. Playing this as an oversold bounce from the hammer candle, with stochastics hitting 11. Stop is under the hammer around $54.50.
QQQ formed a hammer and remounted the 200 dma on very high volume. Unlike $DIG, this one was entered intra-day nearer the lows. There was an intra-day W pattern showing accumulation in play. I will create a video going over this over the weekend.Now we look for a bounce that closes the gap, and possibly a run higher after remounting the moving average.
$SPY formed a similar hammer, after stopping me out, but is still under the 200 dma. That does not mean it can't bounce, it has room. However the ma could provide resistance if SPY reaches that level.Those looking to trade this can enter if the open is flat or slightly up or down, place a stop below the hammer portion of the candle and play a move to the moving average, to $188-189.
I still do not feel it's a good time to trade individual equities, though if good setups do form I will point them out. Make sure when making any trades to keep risk smaller than normal and adhere to stops. Do not get in the mode of thinking the market could bounce at any time and fear missing out. If your stop is hit, get out and make you do not suffer a big loss.Keep in mind that while I am trading for a bounce, it does not mean I am bullish on the market. There is still room to the downside and the bounce I am playing is a "pullback before another drop" type bounce. These are not long swing trades, they are much shorter trades than I normally make. We adjust our styles to the market. 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).
