Sunday, June 29, 2008
RedDirt's Weekly Update
Can the ECB fight inflation by not raising their rate? If they were to keep rates where they are or even make a cut, it could help strenghten the $USD which in turn would lower commodity prices and at the same time help out a little to combat sluggish growth in Europe. Click Here to read a story published by the president of the Czech Republic that tells why the ECB is in a pickle.The Moosecall is to stay in cash for yet another week. Bill says there is no need to jump in front of a dump truck and I agree. What a mess that would be.
As for the BricTrade. There are some bullish divergences trying to build but no clear buy signal yet on the Charts. I'm watching chart #38 closely. It will let me know when it's time to buy.
Our market's took a big hit this past week with the Dow closing below the January and March lows. The S&P is at its lows hit earlier this year and the Nasdaq has now retraced a chunk of the move up from it's March low but on Friday managed to make a somewhat bullish looking candle on the daily chart. If we're going to have a W bottom in the chart for the SP500 now is the time it needs to start working its way higher. Take a look at the charts HERE.
Thanks for stopping by and good luck with all your trades.
Labels: decisionmoose, RedDirts BRIC Trade, sp500, weekly update
Monday, June 23, 2008
RedDirt's Weekly Update
The DecisionMoose stays in $CASH another week. By reading the MooseCall the past couple of weeks it sounds like Bill is being bombarded with e-mails about adding another asset class to the program. Everybody always wants to hold some position in the market. Why is it traders can't realize that being flat the market is a "position". Mr. Dirlam I don't know if you read this blog, but here's a toast to you for sticking by your guns.
The updated GarpScan can be seen by clicking HERE. Twenty stocks made the cut. I haven't had time to analyze the list yet to see what's new on the list or what has dropped out. My first glance of the list 3 stocks really popped out to me. It was like a BricTrade jumped off the page and hit me in the face. WBD is a Russia trade, SAY is a India trade and STP is a China trade. The only thing that didn't stick out to me was a Brazil trade. I'm sure it's probably there I just haven't discovered it yet.
Speaking of BricTrade. Chart #38 on my list, as you all know, is one of my favorites. As I mentioned in Friday's BricTrade Update this is only the 6th time in the past 5 years that the %K and the %D have fell below the 20 line for the Stochastic indicator on the $HKO chart. The only Bullish divergence that I'm seeing is the $HKO couldn't manage to make a lower low even though the EEB did. Could this be a good sign? Like I said in Friday's post,"I'd rather catch the caboose than get ran over by the engine, when this train finally leaves the station."
Thanks for stopping by to see what old RedDirt has been up to and good luck with all your trades.
Labels: BRIC ETF's, decisionmoose, garp stocks, RedDirts BRIC Trade, technical analysis, weekly update
Friday, June 20, 2008
BricTrade Update!
Click on the image to the left and read the note about the Stochastic indicator or click HERE to open the Hong Kong Option Index Chart in a new window. If you have been following along with my BricTrade, you know how closely the EEB tracks the $HKO:$USD ratio chart. The reason for this post is that all the individual BRIC country ETF's are signalling stochastic buys but my favorite indicator for the EEB is saying,"hold your horses." I know this train is going to leave the station one day and I'd rather catch the caboose than get ran over by the engine. After back testing my chart indicators this is the 1st time since the EEB has been trading that the %D on the $HKO has dropped below 20. It is only the 6th time in 5 years that this has occurred for the Hong Kong options index. For the investor it's probably a good buying opportunity, for the trader, why get ran over by the engine if you can catch the caboose.Labels: BRIC ETF's, candlestick charts, RedDirts BRIC Trade, technical analysis
Saturday, June 14, 2008
RedDirt's Weekly Update
I'm starting out this weekly update by discussing my GarpScan and the stocks that show up on that scan. The first thing I want to look at is a stock that showed up on every scan in January and my only scan in February. Then I ran a scan the day after this stock broke out to the upside and it disappeared from my scan. Here is the Yahoo Profile for the stock I'm talking about. I was really surprised to see IXYS Corp. show up on my most recent scan from June 8th after nearly doubling from the March lows. IXYS actually falls into two catagories of trades I monitor. My Garp trades and my Green trades. It makes me wonder, is this the next Microsoft or Walmart? I've added the direct link to the GarpScan Results to the top of my sidebar on this blog. What's really impressive is IXYS not only showed up on my most recent scan, but it ranks #3 on the list in Price/Sales and only a 15% debt Ratio. That's a good sign. With a PE of 17 versus the industry average of nearly 21 it leads me to believe this stock has some room to run. PSYS has formed a cup&handle chart pattern. AXTI has built a 3 month long base and looks to be getting ready to break out to one side or the other. A couple of other long time Garp stocks BUCY & CAM continue their uptrend's even with all the talk that the oil market is about to correct big time. The consumer discretionary stocks on the list like GES, DECK and BJRI are probably wait and see candidates.Now for the BRIC Trade. India led the way this past week with gain of 2.25%. If you combine all 5 daily candles for the week it would look like a hammer has formed on a weekly basis. This past weeks low of $57.85 for the INP could be a bottom for now. Russia finished in 2nd place for the week with a slight loss, down 0.2%. China got a little bounce Thursday but finished the week with a loss down 2.28%. Brazil was this weeks big laggard dropping another 4.2% on the week. Every chart on the BricTrade Page shows the stochastic in over sold territory. India looks like it will be the 1st ETF to provide a buy signal.
This past Friday I took a position in the SSO because of the action that took place on the 60 minute chart when we got a couple of nice bounces from the gap area the hourly chart. The 60 minute chart managed to close above the trading band. A break above the last candle on Friday I may add to the trade. A break above last weeks high I will for sure add to the trade because of the bullish looking doji on the weekly chart. I was seeing buy signals on the 1 minute chart. that reinforced my decision. I didn't load the truck. Just took a 40% allocation to the trade off of 2 positive time frames. The Daily , Weekly and Monthly have some more work to do to turn me positive in those time frames. I've also started building a position in GE. Over 4% dividend and seems to me they're in a sweet spot with the dollar and foreign sales , the wind power & solar, infrastructure(water and other utilities) and transportation(planes, trains and automobiles). I've traded GE twice in the past year and made $ on both trades. This time I'm thinking about pulling in some big bucks..Let's hope it works out! I'll also be keeping a close eye on the QLD as the $NDX:$SPX ratio chart has continued to impress with the tech stocks out performance of the 500 for awhile now. I'll use the QLD as a proxy to the SSO to help me beat the S&P500 return.
Don't forget to follow along with decisionmoose.com to see what Bill Dirlam's program is telling him to do. You can click HERE to watch the charts and any switches that are made.
And now for some of that 4 letter stuff. (WORK) Here are a couple of links to study that could help you become a better informed analyst. I use this indicator to not only help me determine when something is over bought or oversold but it also helps when detecting bullish or bearish divergence. Link#1 & Link#2
Labels: bearish engulfing, BRIC ETF's, candlestick charts, decisionmoose, garp stocks, green trade, RedDirts BRIC Trade, sp500, stock scans, stockcharts, weekly update
Friday, June 13, 2008
What makes a Market?
A buyer and a seller is what makes a market. If I've got it, and you need it or if you've got it and I need it. Market prices come down to supply and demand. If I've got it and you need it we will eventually settle on a price no matter how wide the spread at the beginning of our negotiations. This is where liquidity comes into play. If the commodity or equity has fewer participants then the spread is likely to be wide versus many suppliers and many buyers whereas the spread will be tight. If you are a newbie, keep this in mind. Start out trading only very liquid, high volume stocks or ETF's. If you want to stay with this game, take a look at something like the SPY or the QQQQ's and just learn how to trade one of those two markets. Then once you get really good at that you may want to add a little leverage by trading the profunds or futures. Keep watching page 1 and 2 and the first 5 charts on page 4 @http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID763084. All time frames monthly,weekly,daily,60 minute and 1minute charts are telling me to be short the S&P 500 right now. I'm still flat the market since coming back from vacation, but for some reason my gut tells me to keep my powder dry and only enter this market to the long side one time frame at a time. 20% increments. One fifth of my funds for each time frame. BE PATIENT! If all the big shots are having to de-leverage, where is that money going to go to work? Maybe the Spyder's and the Q's. I think this is why Buffet made a safe BET ...........
Labels: Nasdaq 100, sp500, trading desk
Thursday, June 12, 2008
BRIC NEWS
India Rate Rise Means BRICs to Suffer in Price Fight
China Is Nowhere Close to Victory on Inflation: Andy Mukherjee
China plans to increase its wind energy
China Is Nowhere Close to Victory on Inflation: Andy Mukherjee
China plans to increase its wind energy
Labels: BRIC ETF's, RedDirts BRIC Trade
Tuesday, June 10, 2008
Normal Correction
The pull back keeps bouncing off the 50% fib-retracement level. This would seem to be a normal correction for the market after a strong run since mid-March. Here's a link to the DAILY CHART. If 1350 should hold and the market can make it's way to a close above the 65 day moving average, I think a strong rally could lie ahead. There's so much pessimism that I'm starting to think about the surprise side of this trade.
Sunday, June 8, 2008
RedDirt's Weekly Update
My vacation is about to end so it's time I get back to work. This weekly update will start with a look at the BricTrade. Since my last post I was stopped out of the EEB trade. My favorite indicator for the BricTrade, The HongKong Option Index , is once again in oversold territory according to the stochastic. The past two weeks haven't been kind to the individual BRIC country ETF's as India has led the decline with a drop of 7.42%, China fell 5.36%, Brazil dropped 2.72% while the strength of the group was Russia posting a 1.89% loss. Bloomberg reported that Citigroup strategist Geoffrey Dennis is predicting a 10% drop for the Brazilian market. Brazil and Russia have recently outperformed the EEB whereas China and India have underperformed. This may all be about to change. India is trading at about a 50% discount to where it was in early 2008. I'll be looking for some sort of reversal candle now that the INP is trading near a level of support on the chart. Wouldn't it be great to see a Hammer candlestick with high volume as the INP test support?Now for a look at our markets. The Weekly S&P500 chart stopped it's drop at the center line of the Bollinger band. This weekly drop came with higher than average volume and the Daily Chart has once again closed below it's trading bands and the 65 day moving average. Looks as though the "next shoe" may be about to drop. I'm looking at the inverted ETF's for a trade.
The DecisionMoose posted by William Dirlam has continued to stay CASH for sometime now. I really don't see a switch coming anytime soon. Click HERE to see the latest Moosecall. Don't forget to click the refresh button on your browser to make sure the info is timely.
I'll be running the GarpStocks Scan later today. So you can click this LINK to see the most recent list. Thanks for stopping by and good luck with all your trades.
Labels: BRIC ETF's, candlestick charts, decisionmoose, garp stocks, RedDirts BRIC Trade, sp500, weekly update
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