Day Trading Game Plan | August 20

Many more stocks on the short-side of my day trading game plan today…

Have the bears taken a bite or is this simply summer trading with no direction? I think volume tells us the story.

Stock Market Today: Map of the S&P 500

(click the map for a full view)

Day Trading Game Plan

Day Trading Game Plan: The SPY ETF Chart

The SPY traded 120 millions more shares than the previous day, and traded below the open for the majority of the day. The FOMC minutes gave us a spike higher but price action returned lower. The sellers may have taken a stand. Lets see what the buyers have to say today and tomorrow. If you are day trading the SPY or the ES, be picky in this mostly sloppy trade.

(click the chart for a full view)

Day Trading Game Plan

Stocks to Trade | Thursday August 20, 2015

Pete’s Notes:

  • Many more short-sale set ups to trade today.
  • Oil continues to move lower but no sign of capitulation yet.

Charts in Focus

D R Horton Inc. DHI

Sometimes a higher open in a strong stock is not a time to buy. It can be a time to sell to those late to the trade. DHI price action is strong, a solid stock to buy with new multi-year highs this week. If you dig a little deeper into the story, volume the last 2 days has increased AFTER a significant move.

This is typically a “clean-up print.” I call this exhaustion to give you a better mental picture. It shows us the buyer who pushed the stock higher is done.

In this case a higher open today would not have the “big-money” support to hold the stock higher. So if you already own the stock, a higher open would be a profit taking opportunity, not a time to initiate a new trade. To take it a little deeper we would anticipate a higher open to trade lower for the remainder of the day and close below the open price.

(click the chart for a full view)

Day Trading Game Plan

Earnings in play today > 1M avg shares: brcd, crm, gps, hpq, intu, mrvl, rost, shld

Bullish Ideas ATR/Volume/Price: UA, AMZN, NFLX, HD, TSO, VLO, NKE, TWC

Bearish Ideas ATR/Volume/Price: gmcr, yelp, qrvo, viab, bidu, uri, swks, dvn, paa, cvx, rrc, cof, kss, clr, baba, bhi, wynn, sina, unp, vtr, cat, mmm, ibm, slb<80, hes, utx, apa, apc

Weak Stock Weak Close: tasr, csiq, cop, dvn, fti, cvx, mur, rrc, cnq, clr, bhi, cog, hal, nxpi, lng, slb, cam, apa, sndk, apc, eog

Strong Stock Weak Close: HFT, NFLX, MDLZ, VLO, UNH

Weak Stock Strong Close: RAX, SYMC,

Strong Stock Strong Close: BXLT, DHI LUV, LOW, XEL, AEP, PEG, PGR

20 day Breakdown: hal, csiq, hpq, cop, cvx, pg, sndk, slb, bp, ntap, cnq, wfm, dvn, urbn, rrc, amtd, kkr, etn, fti, qihu, gmcr, mur, tasr

20 Day Breakout: LOW, DHI, EXC, MRK, MCD, PGR, ARMK, AXP, AEM, HCP, XEL, DLTR, EIX, CMS, PEG, AEP, CDNS, D, DUK

2x Normal Volume:  TGT, WMT, CSIQ, LOW, DHI, SNDK, ADI, YUM, TJX, AER, ARMK, AEM, AFL

Watch List Longs: TJX, HD, MCD, VLO, SBUX, TWC, BK, LUV, LOW, TOL, HD, LEN, ADBE,

Watch List Short: cop, cvx, kss, bhi<95, hal (38 support), all, xom, wmt, slb, m, dow, wynn, dd, hpq, qcom, lltc, wmt, ntap, klac, sndk, txn, intc

Inside days: hd, swks, phm, tsla, mas, fit, hum

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Day Trading Game Plan | August 20

Sector rotation, for the purpose of this discussion, is in the context of stock picking.

Sector Rotation [Video and Transcript]

What’s more important effectively keep making higher-highs and higher-lows or the fact that we keep doing it a decrease in volume?

Right, something I think you do have to be aware of…

I spoke a little bit yesterday with somebody and they said “I can’t understand, you know we keep going higher but nobody’s really trading if we keep going higher.” and I’m like what’s more important the fact we keep going higher or the fact that there’s lighter volume?

You aren’t going to take the volume into the bank.

Right, right exactly. I think well I mean I think we’ve been harping on this now for three months but I think it’s still important, it is the individual stocks. We’re not really trading the markets, it’s really hard to trade the market as a whole.

If we can find each the strong sectors or the weak sectors we can trade them and then we find sectors that are do nothing even if they were a do something before they’re a do nothing now.

Continue reading to improve your trading game plan with sector rotation...

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Leave a Reply 4 comments

bob Reply

Pete,great analysis, goin into today,,,oil ,the integrated—CVX,,XOM,,no capitlation, you said ,I agree,CVX—on the 15-year monthly just starting to touch it,s 167dma –not happened since 2003——–drawdown close to 48%—for this size stock,,134.10—–down to 80.00—-wow,,buy or wait or small scale in ????????

    Pete Renzulli Reply

    Thanks Bob…
    Not a long yet.
    I have some friends that are scaling into oil but starting out with 15% of their expected total allocation.
    Wait until we get the cover of Barons to be “How low can oil go?”
    Have a great day!

    Passion4Trading Reply

    Hi Bob,

    If u look on the weekly chart for CVX… you will see a significant demand pivot of 80.41 on the 12/3/10 ending candle. The next significant area of demand if this is broken is at 78.16 from the week ending 9-24-10. If u choose to enter now (low odds at this point however…as there is nothing pointing to a meaningful reversal…YET) — this is where u could draw your line in the sand where proven wrong. If that gets taken out– u will want to reassess as there is no relief in sight until 72.57 from 8-27-10.

      Pete Renzulli Reply

      thanks Lou
      good analysis

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