Tuesday, June 25, 2013

Tuesday: No Trade

All five of the bull and bear signals that survived initial screening last night have failed the next wave of analysis. (See my post "Tuesday's Prospects" for details of the initial screening.)

WRPT moved back within its 20-day price channel in trading today, thereby failing to confirm its bear signal, and SNCR has insufficient options liquidity for me to construct a bearish position that meets my trading preferences.

Two other signals that broke out to the downside have charts that don't match the direction of the bear signal.

VHC has been in a sideways correction since October 2010. A downward move (lower high, lower low) since July 2012 could well represent just another zig or zag within the correction. It's ambiguous.

YOKU has been trending generally sideways since August 2011. It has risen from a lowest low to a higher high, set a higher low and may or may not be attempting an uptrend. It is also ambiguous.

The one bull signal was given by FLTX, which has clearly been in an uptrend on the weekly chart since it went public in October 2012. However, it has only three quarters of history, which is a bit sparse for my taste. I for a company to have at least a year of data before I consider trading it.

VHC, YOKU and FLTX all have acceptable historical odds on their breakouts during their nearer term trends, although VHC and YOKU are showing negative win/lose yield spreads over the longer term and so are poorer risks.

For those reasons, I won't be adding any new positions today.


My trading rules can be read here. And the classic Turtle Trading rules on which my rules are based can be read here.

Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.
No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.

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