Today’s Trading Lesson…
Recognizing and then admitting a trend has changed sounds easy, but we tend to have opinions.
A potential change of trend is where money goes to die. We lose sight of risk/reward in favor of the previous order flow. Figuring out when a trend has ended is only part of the problem. Admitting it and doing something about it are not the same thing.
Whether you use stochastics, RSI, MACD, Fibonacci extensions, pivot points or just plain candlestick patterns, you need to be decisive.
When stocks trade into a range we tend to adapt to the market and change our main trend.
This sounds good in your head but becomes a future trade management problem. If you daily charts are consolidating, it’s not a good idea to switch to a different time frame for a trend.
This chart gives some ideas about committing to your strategy.
On the Tape Today...
$UA 11-28-16 (Click to Enlarge)
$UA swing trade short trigger on a $29.50 sell-stop with minor support @ $28. The ultimate target remains $23. Tough to day trade right now as the average true range shrinks. (see chart)
$WDC bullish ascending wedge shows $2 profit potential on a $62 breakout with a larger potential profit to the $68 resistance. $84 becomes the next target if the bulls grab and hold the bid.
How to Use Multiple Time Frame Analysis to Create a Daily Game Plan
OPEC deal in doubt, and that means $30 oil — analysts react to latest developments
Analysts were weighing in on Monday as fresh developments cast a shadow over whether this week’s OPEC meeting can deliver a much-anticipated production cut.
Crude CLF7, -0.20% prices have lost 4% since Wednesday, but where they go next is a moving target, buffeted by the horse trading ahead of the summit. On Friday, futures were hit by news that Saudi Arabian officials won’t attend a Monday meeting with Russia and other energy producers outside the Organization of the Petroleum Exporting Countries.
The 14-nation cartel meets in Vienna on Wednesday to try to finalize a deal to reduce output.
Analysts suggested the Saudi move is aimed at putting pressure on Iran to agree to a freeze. Iran and Iraq are seen as potential blockers to an output agreement.
Continue Reading on marketwatch.com
Stock Market Today: Heatmap of the S&P 500
Stock Trading Today 11-28-16 | OPEC Meeting
Stocks End Thanksgiving Week With Modest Gains; Oil Slumps 3%
Stocks capped a shortened week of trading with modest gains Friday ahead of a busy week of economic data and a key OPEC meeting.
Cisco Systems (CSCO) outperformed in the Dow, rising 1%. China-based Ctrip.com (CTRP) led the Nasdaq 100, surging 10% on a big earnings beat.
The Dow Jones industrial average, S&P 500 and Nasdaq composite ended with gains of 0.3% to 0.4%. All closed at record highs.
Utilities were among the day’s top performers while oil and gas names lagged. Futures of December’s West Texas intermediate crude oil were down more than 3% to $46.35 a barrel ahead of next week’s OPEC meeting, when some sort of output cut is widely expected.
Continue Reading on investors.com
Tape Reading the SPY ETF
$SPY prices since the election showing a grinding but relentless bid by the Trump bulls. (60 minute chart shown) How long can it last? Profitable trading will be difficult if you are waiting for a top or bottom.
When the bias is obvious, trade it. Waiting for an eventual reversal wastes a lot of P&L during clear order flow. Great traders have criteria for a reversal but trade confidently until the scenario changes.
Should the $SPY reverse and we see some profit taking, the $216 area remains the spot to look for new swing trade bids.
OPEC makes last-ditch bid to save oil deal as tensions grow
OPEC was trying on Monday to rescue a deal to limit oil output as tensions grew among the producer group and non-OPEC member Russia, with top exporter Saudi Arabia saying markets would rebalance even without an agreement.
OPEC experts started a meeting in Vienna at 0900 GMT (4:00 a.m. ET) and were due to make recommendations to their ministers on how exactly the Organization of the Petroleum Exporting Countries should reduce production when it meets on Nov. 30.
Meanwhile, the Algerian and Venezuelan oil ministers were to travel to Moscow on Monday and Tuesday in a final attempt to persuade Russia to take part in cuts instead of merely freezing output, which has reached new highs in the past year.
Continue Reading on reuters.com
Crude Oil Prices Fall Ahead of Key OPEC Meeting
Crude oil prices fell in early Asia trade Monday after Saudi Arabia said it wouldn’t meet with Russia—which isn’t a member of the Organization of the Petroleum Exporting Countries—ahead of the OPEC summit in Vienna.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in January recently traded at $45.98 a barrel, down $0.08 in the Globex electronic session. January Brent crude on London’s ICE Futures exchange fell $0.08 to $47.16 a barrel.
Saudi Arabia, the world’s largest oil producer and de facto leader of OPEC, was supposed to meet with non-OPEC producers—including Russia—on Monday.
Continue Reading on WSJ.COM
Stocks to Trade 11-28-16 | Monday Edition
Short-Term Trading Momentum:
Positive the last 20 and 5 trading days | closed 2% higher from the open: DE
Negative last 20 and 5 trading days | closed 2% lower from the open: gps, srpt, urbn
Quarterly Order Flow:
Bullish Stocks to Trade: DE, IONS, LYB, WDC, PNC, ADI, URI, IBM, UNP, LRCX, NUE, RCL, X, TRGP, MCD, DLTR, UAL, STT, NVDA, BA, AET, PRU, CVX, COF, BHI, ADNT, CAT, GS, KSS
Bearish Stocks to Trade: htz, agn, mdt, vtr, cvs, hca, cci, hcn, trip, lly, tsn, aem, fslr
2x Normal Volume: CTRP, DE
Inside days: c, wfc, fb, nvda, pm, cvx, ebay, nke, met, gs, apa, adm, vlo, mgm, cof, ma, oxy, dltr, gis, rost, pru, mur, hes, hca, car