Friday, March 12, 2010

3/12 Watchlist

The S&P500 exchange-trade fund, SPY, fell to touch support early in the day and then bounced up, never to go there again (so far).

Treasury long-term bonds (TLT) rose by 1% low to high, pausing at resistance set last December.

Not a good day on the Watchlist: One success, two failures, one massive failure and a wash. Items marked with an asterisk are in my portfolio.

In mitigation: The massive failure would be a wash if played as an iron condor, which I suggested was the best course. The success and two of the failures were analyzed before I started factoring in the adx, which is a corrective to avoid whipsaw. And in the case of one failure and the wash, I noted the weak adx readings in the analysis. Also, one of the failures came on a news surprise.

So all in all, I don't feel too despondent.


Abbreviations:
psar - Parabolic Stop and Reverse, adx - Average Directional Index, pps - Person's Proprietary Signal, ma20 - 20-day moving average, macd - Moving Average Convergence-Divergence, mfi - Money Flow Index, sto - Fast Stochastic

The bounce level, $115.14, was major resistance before Thursday, the January top of a run-up that began in March 2009. Once decisively pierced on Thursday, it was transformed into support, as tends to happen to resistance when it crumbles.

SPY spent the day in a middlin' sort of way, although it did manage to set a new high for the sixth trading day in a row, at $115.97.

The net movement, however, was down, as the price traversed -0.7% high to low.

The TLT chart showed a pps bull signal. The psar and macd remained in bear mode, although the macd was relapsing toward the zero-line, which has the makings of bullishness to come.
The adx, at 11, is at a level that tends to increase whipsawness among the more sensitive signalers.

The watchlist.

Great section on what to do when good trades go bad.

Psar bull signal:
  • AMZN, analysis: Opened above the day-before close, at $134.20, and then pulled back to $131.68. The macd is weakening. The price is 5% above the theoretical opening. I would close it now, and declare this position a SUCCESS.
  • *AOD, analysis. At $9.13. Next resistance at $9.20. 
  • AUD/CAD, analysis. Fell sharply to C$0.9318. I would close it now for a 0.8% loss. This position was a FAILURE.
  • EWT, analysis. At $12.36. Next resistance at $13.46.
  • GBP/USD, analysis. New today.No breakout.
  • GE, analysis. New today. No breakout.
  • *GME, analysis. No breakout.
  • INTC, analysis 1 2. At $21.29. Next resistance at $21.55.
  • KFT, analysis. No breakout. 
  • SD, analysis. New today. No breakout.
  • USD/JPY, analysis. At ¥90.52, pulled back below very near-term support. The signalers are still bullish and I'm not closing yet.
Psar bear signal:
  • DOW, analysis. Moved past upside resistance to a daily high of $30.22, near the next level. The position is showing a new pps bull signal, and the macd is rising again. So I would close the position for a devastating 3% loss and declare it to be a MASSIVE FAILURE. I don't see any news that explains the three-day whipsaw. The adx is at 15, which is an area in which the psar tends to be very whippy. However, I suggested playing it as an iron condor, $30 to $26. In those terms, it's a wash, not a failure.
  • GLD, analysis. At $107.97. Next downside support at $106.60.
  • HPQ, analysis. At $52.33, with a new psar bull signal. This was a one-day whipsaw on news. I'm kicking it off the island for a 1.2% loss. I declare this position a FAILURE. The news was an unexpectedly happy forecast released by the company. I don't know of any way to defend against such things except by keeping tight stops and being fearless in taking losses.
  • IVZ, analysis. Reversed and is at $20.41. Closing for a 0.05% loss. This position is a WASH.
  • *WFC, analysis. A new high at $29.94, now at $29.71. Next resistance, set in October 2008, is around $30. It's a pretty congested region and will be difficult to overcome.
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Topics:
Alpine Total Dynamic Dividend fund, Amazon amazon.com books, AT&T Telecommunications, Dow Chemical, Taiwan, Korea, gold, Invesco investments, Intel semiconductors bum-bum-bum-buh, Kraft Foods, MGM Mirage gaming casino resort, Nvidia video, Sandridge Energy natural gas, Wells Fargo bank financial, Forex, U.S. dollar, Japanese yen, British pound, U.K., Australian, Canadian.

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