For some reason day trades want to catch a bottom instead of riding the order flow short…
I guess that’s because many stock traders are long only. They don’t like to sell-short. That’s OK, but that doesn’t justify buying a stock with vicious selling volume. It’s OK to be in cash.
The SPY and many stocks produced a bearish engulfing candlestick yesterday. The odds of a lower open are 90%. The odds of a lower close are less than 50%.
Draw simple trend lines during the day to make sure you are trading with the trend. If price action on the 5 minute chart begins trading above the trend, and the current hour is positive, it’s a sign we may have a short term bottom. <—- (CLICK THE CHART ABOVE FOR A FULL VIEW)
Stock Market Today: Map of the S&P 500
(click the map for a full view)
SPY $190 is the level to watch this morning. Day traders looking for a quick momentum trade long, are planning for a breakout above this level. If the first move in lower, then this sets up $190 as the first profit target on a long. SPY $187 is the next support.
These are momentum ideas only. Order flow in the spy is to the short-side. If you’re day trading the SPY long, make sure the current hour is positive.
(click the chart for a full view)
- Capitulation is a funny thing. It means the end of a move, but too many stock traders are looking to buy beaten down stocks. That is a viable trading strategy but if it’s your sole focus you missed some great money on the short side.
Technical Analysis | Charts of Interest
AEM is one of the few stocks with decent volume trading above the 20 ema and with a strong close yesterday. The stock has $1 profit target from yesterday’s close and a much better reward potential to $33.75.
(click the chart for a full view)
Stock Traders Seek Capitulation Selling 1-14-16
> 20sma | positive the last 5 days | closed 2% higher from the open: AEM
< 20sma | negative last 5 days | closed 2% lower from the open: tso, mbly, mpc, vlo, nflx, etp, car, swks, yelp, apc, thc, mar, amzn, ctrp, trip, abbv, ual, lvs, nxpe, aer, gild, tsla, wdc, aal, bhi, dal, gs, oke, fb, len, dvn, amgn, googl, ea, bmy, lrcx, cof, unp, cop, kmx, dis, ba, crm, jpm, lng, bbby, aapl, ups, ma, cf, nbl, dhr, akam, v, cah, utx, pru, cci, slb
Bullish Ideas ATR/Volume/Price: BXLT, NEE
Bearish Ideas ATR/Volume/Price: tso, mbly, mpc, hfc, etp, car, swks, apc, thc, mar, celg, abbv, ual, avgo, nwl, aer, gild, wdc, tsla, bhi, dal, gs, len, dvn, bmy, lrcx, cof, unp, kmx, dis, lng, bbby, aapl, ups, hes, nbl, akam, cah, utx, slb, cat, oxy, amba, apa, fit
Weak Stock Weak Close: tso, mbly, mpc, vlo, nflx, etp, car, swks, yelp, apc, thc, mar, amzn, ctrp, trip, abbv, ual, lvs, nxpe, aer, gild, tsla, wdc, aal, bhi, dal, gs, oke, fb, len, dvn, amgn, googl, ea, bmy, lrcx, cof, unp, cop, kmx, dis, ba, crm, jpm, lng, bbby, aapl, ups, ma, cf, nbl, dhr, akam, v, cah, utx, pru, cci, slb
Strong Stock Weak Close:
Weak Stock Strong Close:
Strong Stock Strong Close: AEM
20 day Breakdown: jpm, cop, apc, vlo, clr, dvn, bmy, mpc, adsk, hd, utx, ual, amzn, wdc, mbly, swks, nwl, cyh, wpz, mar, cof, gs, cf, pru, thc, car, aer
20 Day Breakout: M
2x Normal Volume: WSH, MS, MET, ESRX, COP, BXLT, APC, ETP, VLO, ADSK, BWA, NWL, HES, PSX, GT, TSO, DLPH, PRU, MCHP, ACE
Watch List Longs: mo, MCD, KSS, WMT, T
Watch List Short: wynn, ual, lvs, low, dal, len, c, intu, txn, dd, dow, akam, nue, tol, qcom, ms, hd, bhi, bmy, bk, cof, hal, cop, dis, jpm, axp, mrk, pru, jnj, slb,
Inside days: etp, twx, rrc, pg, eog, gps, wy, ppl, xel, fti, d, gme