Feels like musical chairs up here w/ the market extended as it is, but I’m presently thinking more topside. VIX did achieve an 18 handle on Friday, however.. still watching for SPY gap closure north of $133. A few ripe setups below, & additional color on Twitter.
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LONG
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SHORT
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Holiday shortened week coming up with the market closed on Monday. Options expire on Friday, and max pain for SPY is about 3% lower at $125. Despite clear potential for more upside in the short term, I have little on my watchlist in terms of liquid longs. Many charts are simply overbought. So then, with the exception of HOS, I will point out several obscure firecrackers in need of possible attention, and then there are a half dozen juicy shorts.
Always be cognizant of rogue earnings reports by checking the earnings calendar.
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LONG:
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SHORT:
A lot of people will tell you technical analysis doesn’t work on penny stocks. New to the blog this coming year will be my attempt to prove them wrong. Starting w/ $10k split between five stocks, I will semi-actively manage a model portfolio, and see what sort of performance numbers I can put up. Commissions are assumed to be $10 per round trip and a penny stock will be defined as anything under a dollar. Executions are based on market close.
Without further adieu, here are the initial contenders, followed by their charts:
Greetings once again from TraderDigs’ Laboratory. Today is the first day of fall; the autumnal equinox. Daylight hours are rapidly diminishing and the nights are getting cooler. With winter on the horizon, I have a theory about natural gas. As I’m sure you’re aware, charts elsewhere are very messy, but there’s a few things to look at in natty as we plumb new depths on lackluster volume.
As a reversal trade, all the usual caveats apply, but this one looks compelling. My macro theory here is that natgas currently represents one of very few asset classes that could be appropriately termed as “value.” Everything else was inflated by QE ad nauseam. I’ve read about the supply glut, but despite that I think wary funds looking for a home in an otherwise casino of a stock market may find it in this abundant domestic resource.
Sure, there are also political angles, but I’m mostly concerned with the charts, and that’s what I wanted to look at here. I would like to also point out its relative performance on Thursday, having been down only about 1% against a backdrop of much larger losses elsewhere in the commodities complex.
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UNG daily chart – first thing to notice is a double MACD versus price diveregence. Second is the non-confirmation in volume. Put simply, sellers are not aggressive.
GAZ weekly chart – backside retest of a broken downtrend line. I have been tracking this for a long time. Jesse Livermore once said that in making speculation a business, one necessarily keeps an eye on all markets for big opportunities. Is this one of them?
UNL daily chart – dollar volume is not great, but there are market makers with size on both the bid and the ask during normal market hours. This last chart is dynamic and will update over time.
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As always: Use stops. Stay nimble. Questions/comments welcome!
“The first panacea for a misguided nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists alike.”
This quote resonates well with me, now more than ever.
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