Our stock trading strategies are based on surprisingly simple yet effective no nonsense logic that is uncommon in the stock market. For our short term trading strategy we: Buy at support; we take small, quick profits; and we use the 10/2 rule so that we never slip backwards.
Friday, September 29, 2006
Sentiment Readings Near Dangerous Levels
Thursday, September 28, 2006
Selling Tech

Wednesday, September 27, 2006
Time for Caution

Also note the important break in the uptrend line yesterday, even as QQQQ shares traded higher. Adding insult to injury, the S&P 500 made a new 5-year high yesterday, while the NASDAQ lagged significantly. This type of bearish divergence has preceded each failed rally for several years now. Gaming Window Dressers: End of month window dressing has been increasingly gamed by traders who have learned the pattern. Not that long ago window dressing would result in rallies which took place during the last three days of the month, and sometimes extended into the first two trading days of the following month. Now, however, traders have been taking advantage of the rallies and selling into them during the later days, causing the rallies to start to fizzle during the last day or two of the month. If this pattern persists, it means that today should market the last day where window dressing is able to push the market higher. S&P Rising Wedge: One of the most bearish of all rally patterns is the rising wedge, a pattern we have highlighted several times over the past few weeks in the S&P 500 index. We have hypothesized that before this wedge gives way to selling, a strong upside breakout would occur in order to draw in bag holders. Yesterday we got the initial move of just such a breakout, as can be seen below.
Time for Caution

Also note the important break in the uptrend line yesterday, even as QQQQ shares traded higher. Adding insult to injury, the S&P 500 made a new 5-year high yesterday, while the NASDAQ lagged significantly. This type of bearish divergence has preceded each failed rally for several years now. Gaming Window Dressers: End of month window dressing has been increasingly gamed by traders who have learned the pattern. Not that long ago window dressing would result in rallies which took place during the last three days of the month, and sometimes extended into the first two trading days of the following month. Now, however, traders have been taking advantage of the rallies and selling into them during the later days, causing the rallies to start to fizzle during the last day or two of the month. If this pattern persists, it means that today should market the last day where window dressing is able to push the market higher. S&P Rising Wedge: One of the most bearish of all rally patterns is the rising wedge, a pattern we have highlighted several times over the past few weeks in the S&P 500 index. We have hypothesized that before this wedge gives way to selling, a strong upside breakout would occur in order to draw in bag holders. Yesterday we got the initial move of just such a breakout, as can be seen below.
Tuesday, September 26, 2006
As Long as Everyone is Bearish, This Rise Will Continue
Monday, September 25, 2006
Window Dressing Should Prop Up Weak Market

Friday, September 22, 2006
Market Cracks Some More
Thursday, September 21, 2006
SMH Fails to Make a New High
Wednesday, September 20, 2006
Monday's Scenario Still In Play
Tuesday, September 19, 2006
Buyers Still in Control/Tech May Have a Top
Monday, September 18, 2006
Support Test Coming Up

Friday, September 15, 2006
Watching and Waiting
Thursday, September 14, 2006
Pavlov's Lesson
Wednesday, September 13, 2006
Bulls Refuse to Give Up
Tuesday, September 12, 2006
Watching Tech's Head and Shoulders
Monday, September 11, 2006
Three Potential QQQQ Scenarios

If this is indeed the case, we should see the price bounce around between $38.00-$38.70 through options expiration, and then potentially break lower. Cup and Handle (bullish)
Friday, September 08, 2006
No Advantages to Forcing a Trade
Thursday, September 07, 2006
Stay Patient, Sentiment Will Swing Again

Wednesday, September 06, 2006
Be Careful Here
Tuesday, September 05, 2006
What September May Hold

2. Likewise, the S&P 500 and Dow have rallied back to their April failure points. However, note the notable decrease in stocks making new highs during the latest rally (the yellow bars represent stocks making new highs, while the blue line represents the S&P price levels). This is a very strong bearish divergence, which makes a breakout to new highs very unlikely.