Tomorrow's plays

Discussion in 'Stock picks and trading strategies' started by NEWinv, Oct 7, 2008.

  1. NEWinv

    NEWinv Member

    Days like today are the hardest to stomach. As a new investor i've made some serious mistakes in this market. Whether it was not hedging my positions correctly or making the ultimate Newbie mistake of doubling down on a failing trade...wont make that mistake again.

    I'd like for this thread to be used by others on this site as a way to help newbies, like my self and many others understand what is ahead of us based on technical analysis. TA can be discussed on indices or individual stocks/etf's ...etc. It could also be a great place for newbies to speak about what they might be thinking about (trade) for the next day based on their own TA with some feedback from members.


    What are the technicals telling us?

    Today, In another thread I read that tomorrow is an important day because if we see a mid-day reversal with good volume we may see a tradeable bottom... I'd love to see that happen...truth is this market sucks big time, but the bigger question is where should we see support?
     
  2. This is a huge over simplification and not by any means technical analysis, however:

    When I look at a long term chart of the DOW, from the 80's up to today, I see a trendline that looks like it crosses around 9500 or 10000 at this point in time. You can clearly see the tech bubble of 1997-2000 and the housing bubble from 2004-2007. To me 10,000 seems more natural. I clearly hope everyone else sees this too and they return to their senses hehe
     
  3. NEWinv

    NEWinv Member


    I think I saw the same thing you saw on the charts for the dow. At times I do think people have been panic selling.
     
  4. john_for_u80

    john_for_u80 Active Member

    Technically looking at the DOW ETF DIA, if we open lower then we definitely rally when the selling pauses in the AM! I am looking for a bounce.

    If DIA opens lower, it will go out of its BB 3 standard deviation which will cause the fire for small rally at least!

    If we open higher, we need to watch how much market pulls back.

    Lets see, I will look at how the charts look on daily and intra day basis!
     
  5. NEWinv

    NEWinv Member


    thanks for the feedback...this is exactly the kind of things i'm looking for on this thread. Recently, I started trading ETF's and I was looking at the DOG would you apply the same inversely?

    What would you call a small rally, 10%-15%?

    Also, the uyg is at unseen lows with the charts forming an inverse HS pattern. Maybe i'm wrong, what do you see?
     
  6. mlegha1

    mlegha1 Member won weekly contest 9x won feb/08 simulator won oct/08 simulator

    Don't try to catch a falling knife, asian markets are selling off.Don't just get long because some people feel we are oversold and this is a bottom.I would suggest wait for some positive news like a rate cut and then follow the volume.
     
  7. john_for_u80

    john_for_u80 Active Member

    Just to let you know that I only day trade so if market opens lower, I am positive that stock market bounces up. I will look at the intra- day charts to decide my moves. If market goes turns up then I would look to buy one stock out of these names: GS, AAPL, POT or SPY

    I am not sure if you know this BB setting. Everytime we use BB 20,2 but when we use BB 20,3 and when stock goes out of 3 std deviation, stock is likely to get push in that is it moves up. Stock should fall on normal sell off and not on any bankruptcy or FBI raid news :)

    If you know to trade intra-day looking at the charts then only trade keeping some of these points in mind otherwise it is not worth the risk in such volatile market!
     
  8. john_for_u80

    john_for_u80 Active Member

    Does not matter what Asian markets does. US is the one who changes the moves, US does not follow Asian markets!

    Even when Asian Markets did ok when Australian market cut 1 point, US markets worked out the way it wanted going much lower today!

    Regarding oversold & volume, I agree! Rate cuts will make 1 day bounce. Gov or Fed intervention can never bring bottom!
     
  9. Bolimomo

    Bolimomo Active Member

    I agree with upthread... this is a huge over-simplication. Trading is not that simple (I wish it is). Trading is not about predicting that tomorrow the market will do this and will do that. Trading is about reacting to the market environments every damn day and trying to profit from price inefficiency.

    A lot depends on how you want to approach the markets. How much capital do you have, how much risk are you willing to tolerate, what kind of stocks/ETFs do you want to trade, what style do you want to practice (scalp, momentum, swing, long-term, etc.), etc..

    It takes years to be successful at this game.

    I can tell you this: I don't think you will see a market (Dow or S&P index) rally 10%-15% in one day. Not in one day. Today the market retested low. A huge drop. But it was only a 5% drop. But in terms of percentage it was a huge drop. And stocks drop much faster than they rise (which is why I like shorting than longing.)
     
    Last edited: Oct 8, 2008
  10. BuyOnDips

    BuyOnDips Active Member

    ITWO might not be a bad play. Their price is currently $12.94. They are being bought by JDAS for $14.86 in cash. ITWO shareholders will vote on the deal in November.

    http://biz.yahoo.com/bw/080930/20080930005396.html?.v=1

    I think most shareholders will vote for the deal. Especially since the current market is pretty bad. There still is some doubt because the largest shareholder might vote against the deal. If you wish to play arbitrager, buying ITWO might not be a bad play. It the deal goes through, it's about a 15% gain from here.

    There was some concern about the funding of the deal. But JDAS got Wells Fargo to help finance the deal. http://biz.yahoo.com/ap/080930/jda_software_i2_acquisition.html?.v=1

    Good luck.
     
  11. BuyOnDips

    BuyOnDips Active Member

    Another play I like is INFA. It's gotten crushed like some many other stocks in the last few months. I bought some shares under $12 last Friday afternoon. I might add some more if it goes lower. There are some values in the tech area. It recently got upgraded by Roth Capitol. It got upgraded today by Piper Jaffray.

    http://www.streetinsider.com/Upgrades/Piper+Jaffray+Upgrades+Informatica+(INFA)+to+Buy/4051665.html

    It's still my favorite tech stock. IMO, ORCL will probably buy them in the near future. Also note 2 directors recently resigned from INFA's board. http://www.reuters.com/article/marketsNews/idINN0227924220081002?rpc=44

    Good luck.
     
  12. john_for_u80

    john_for_u80 Active Member

    Morning lower open was the best opportunity to trade! Nice day as I predicted for GS, AAPL, POT, SPY!

    POT was the best performer because lot of shorts had to cover!

    I could not trade as I got up late in the morning :(

    I will look at the charts later in the day and then I will try to make my guess for tomorrow! RIght now looking at the close I think we go lower whole day tomorrow!
     
    Last edited: Oct 8, 2008
  13. john_for_u80

    john_for_u80 Active Member

    Looking at some charts of SDS, SKF- They formed hanging man top. If reversal not tomorrow then pretty soon within couple of days!

    $SPX reaching 2002 support area near 942 and fibonacci support area(78.6% retracement). Closed at 984 area.

    May be shorts will start to short from tomorrow and that will bring the fire in the rally!
     
  14. BuyOnDips

    BuyOnDips Active Member


    It was a weird day for me. I bought 100 shares of CBI yesterday at 13.00. I was going to buy some more this morning depending on what it did. It opened down at 12.11. Then it quickly went to $14.20.
    I wasn't able to follow the opening though. When I checked the stock around noon it was at $10.50. It started to rise off it's low of $10.36. I bought 200 more shares at $10.68. It got back to $12.70 in the afternoon when my computer froze. It totally locked up on me. That really sucks. By the time I got back online, the stock had gone to $12.95 but then quickly fell back to 12.19. I sold all 300 shares at 12.19 since I didn't want to hold it overnight. So I made $200 bucks on those 2 trades. It certainly was a wild roller coaster day for those that played CBI.

    http://finance.yahoo.com/q/bc?s=CBI&t=1d
     
  15. john_for_u80

    john_for_u80 Active Member

    I totally agree with you that today was a one of the weirdest day! I just looked at the charts and counted the moves, market moved in 5 directions(down,up.....) intra-day today!
    More than 95% of the times market changes its course once or twice intra-day!

    Well it is always good as far as you make profits or get out with small loss!
     
  16. aiki14

    aiki14 Well-Known Member won april/06 simulator won weekly contest 13x won feb/07 simulator won jan/07 simulator won nov/06 simulator won mar/07 simulator

    Not quite the classic bottom I was hoping for but a day where the direction was indeterminate after the downtrend may be a good sign for the next couple days. Hard to play with a lot of conviction though. I am getting frustrated sitting on such a large cash position, watching. Better than being in though because I have not been predicting the market very well lately.
    I was driving up to NY this morning listening to CNBC and the futures market did about 5 flips premarket as well. Even the straddles on this market are so expensive as to be untenable.
    Rough times indeed.
    I would be short the VIX here, but I went short at 56 and it hit 60, astonishing. Still that's the best trade I see at this point, short VIX Nov futures, long VIX Nov 55 puts.
     
  17. john_for_u80

    john_for_u80 Active Member

    Yeah! S&P is pretty close to 930 area of 2002 base and fibonacci support!

    If market rallies tomorrow, I will look to see next resistance area near 1080 and then we can go lower with a bigger force or we can go straight down to 930!
     
  18. john_for_u80

    john_for_u80 Active Member

    I played with FXP today for 4 points again!

    When I saw market opened high and could break its own high, I was looking to get into SKF but the move was wild as SKF is out of Jail today. I was not able to handle that small quick moves in SKF. I think I need a day or 2 to trade with that sucker!

    I was looking to buy FXP at 132 area but it popped all of sudden to 135 within very small time interval. I still got in at 135 and sold at 139 area. Don;t want to be greedy if I make 3-5 points in a trade :)
     
    Last edited: Oct 9, 2008
  19. stideas

    stideas Member won weekly contest 2x

    Keep steel on your radar for a quick snap...

    It's too stretched from equilibrium.

    sti
     
  20. deviousz28

    deviousz28 New Member

    FXP is near the bottom again.

    ? will WB do anything today.

    Thanks Scott
     

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