The difficult part of day trading is doing nothing…
Sitting in front of a screen all day practically begs you to make a trade. Stock traders who get past the learning curve and into monthly profitability have learned through losses to be disciplined. Holding yourself back from mediocre trading scenarios is not a super-human gift. It’s smart trading.
There will be losses. Strive to make those losing trades on your best ideas. The minute you start messing around with trades you need to justify with “less shares” you skew your probabilities. Allocating money to bad ideas is exhausting and pushes out the number if high-probability trades you need to succeed.
Imagine your research of your P&L statements shows you need 10 high-probability trades to earn a living. If you throw 3 crappy trades into the mix, you need to offset those 3 trades and then make 3 more “good trades.
You are literally making it take longer to earn money.
Stock Market Today: Map of the S&P 500
(click the map for a full view)
SPY price action was as good as it gets yesterday afternoon, including the strong close. Expect follow through today and look for $205 as the first target.
(click the chart for a full view)
- Casino stocks taking a hit on earnings. Let’s see if the recent 2 week buying spree supports the open.
- Basic materials still strong.
- Tracking the financials to see if yesterday reverses the current trading range/down trend.
Charts in Focus
One of our favorite trade setups is the inside day. Contraction leads to volatility, which means a trend day. CAT is technically two inside days in a row. The correct trade management for this is to hold to the close if you get short-term continuation patterns intraday.
(click the chart for a full view)
Bullish Traders Seek Follow Through | Stocks to Trade 10-16-15
Earnings in play today > 1M avg shares: CMA, FHN, GE, HON, KSU, PGR, STI, SYF, SYRG
Relative weakness to yesterday’s SPY positive change from the open: gmcr, nflx, wynn, srpt
> 20sma, positive week and closed 2% higher from the open: BABA, GILD, JNJ, ABBV, GS, SNDK, TEVA, AVGO, AMZN, BMY, ADBE, APC, DVN, MJN, EOG, BIDU, WBA, AMGN, ETP, QRVO, MDVN
<20sma, negative last 5 days and closed 2% lower from the open: nflx, gmcr
Bullish Ideas ATR/Volume/Price: SNDK, TRIP, TSO, NKE, FSLR, OXY, EOG, CRM, ADBE, AMZN, NEE, PSX, MCD, MA, ADI, ACN, GOOGL, DIS, NXPI, TRV, FB,
Bearish Ideas ATR/Volume/Price: xon, gpro, amba, feye, yum, stx, tsla, vmw, hca, myl, gmcr, abc, lng, hot, wmb, dltr, cah, dg, de,
Weak Stock Weak Close: gmcr, hds, stx, tgt
Strong Stock Weak Close: Z, XLNX, FLO, IM, AVT, MGM, TSN
Weak Stock Strong Close: xon, vrx, thc, mnk, amba, feye, endp, biib, tsla, hca, bkd, myl, agn,
Strong Stock Strong Close: SNDK, IDTI, MXIM, NFX, TSO, PCG>54, EOG, ADBE, AMZN,
20 day Breakdown: gps, p, stx, tgt, wmt
20 Day Breakout: C, PFE, YHOO, BABA, NVDA, GG, MXIM, ATVI, MCD, JNJ, FCAU, PM, OXY, NKE, IPG, AMZN, NXPI, ADBE, LLTC, FEYE, IDTO, PG, JBLU
2x Normal Volume: NFLX, WMT, STX, HCA, MXIM, VRX, TGT, WYNN, XLNX, WDC, THC, JAH, VMW, TRIP
Watch List Longs: GE, KO, PM, COST, MCD, MO, SBUX, DIS, HS, TRV, JNPR, CSCO, LLTC, LUV,
Watch List Short: kss, wmt, tgt, usb, m, ebay
Inside days: jd, ebay, dal, aal, txn, dhi, ba, mos, luv, vmw, trip, adi, cat, ual, pgr, rai, utx, pnc, cvs, bby, dltr, mon, kss, low, hrb, tmus, altr, rost, ua, yelp, hcn, cost, nsc