Today’s Trading Lesson…
Trading is a challenge because what we want isn’t possible. We want certainty.
We seek certainty in a situation that has no structure. The stock market can do anything. Up, down or sideways at any time. We know this and yet we still seek control.
Each trade manipulates our self-image. If we make money we feel smart and successful. If we lose we search for reasons to escape the failure.
As days and weeks go by, our emotions get stretched with each result. Good trade, bad trade, good trade, bad trade. Each trade gets more exhausting. Doubt starts to creep in.
As we struggle, common problems occur: we hesitate on entries and we exit winners too soon. We have too many shares on losing trades, and too few shares on the winners. We focus on the problems but never realize they are merely symptoms of the real issue.
The more we trade, the more confused we get. The challenge to be profitable becomes an obsession, a burning desire to learn what’s missing.
A lucky few eventually discover the answer…
On the Tape Today...
$COST | Costco continues a bullish resurgence. Yesterday produced the second bullish gap, this one especially meaningful coming out of an inside day. A close off the highs should not concern bullish traders, because of the two gaps. Looking for a $164 buy-stop to trigger a new long with a target to sell at the $168 level. (see chart)
$TRIP | Tripadvisor continues to close below the open in a bullish tape. Clean lower-lows and lower-highs offer one of the best shorts on the board today. We need to penetrate the $46 support but through this level you have plenty of room to go. Looking for a day trade breakdown of the first 30 minute candlesticks and then a profit target to the ATR (average true range)
Stock Market Today
Facebook Gets EU Antitrust Complaint Over WhatsApp Takeover Bid: Facebook Inc. was sent an antitrust complaint by European Union regulators who say the company may have misled them when it sought approval to buy the WhatsApp messaging service in 2014.
Dow futures point to slow march higher toward key 20,000 mark: Wall Street was poised for another positive session on Tuesday, with the Dow average set to inch closer to the psychologically important 20,000 mark in choppy preholiday trade.
Donald Trump Seals Electoral College Victory, Officially Becomes 45th US President: It’s finally over: Donald Trump has secured 304 Electoral Votes following the Texas vote (with 2 faithless electors), officially securing the presidency of the United States. Of course, the now official President-Elect Trump took to twitter to confirm the victory.
What Lessons Will Dow 20,000 Teach You?: Many participants simply want to believe that hitting milestone markers like Dow 20,000 is a good thing. Few consider the greater likelihood that new highs nearly eight years into a bull market may be indicative of a cycle’s conclusion rather than a precursor to eight more years of equanimity.
Here’s Why You Should Never Buy and Hold Gold: Buying and holding a commodity like gold may be the most ignorant strategy ever… That’s a heresy to some gold “experts” who think they can predict its price direction. But here’s the cold hard truth: The market doesn’t care about what you, I, or any “expert” thinks should happen.
Stock Market Today: Heatmap of the S&P 500
Stock Trading Today 12-20-16
Stocks Up, Microsoft Leads; Can Nvidia’s Fundamentals Turn It Into The Next Apple?
A late-afternoon downdraft of selling pinched the stock market’s gains on Monday, yet the overall trading carried a generally quiet tone with less than two weeks left in the year.
Meanwhile, Apple (AAPL) and Nvidia (NVDA) continued to show oomph in their recent rallies. The former gained 0.6% to 116.64, creeping closer to a potential new breakout at 118.79; the latter rallied 1.2% to 101.63 and made a new high.
Nvidia is also extended from any proper buy points, yet still points to solid demand from institutional quarters for tech stocks overall.
Apple initially broke out of a cup with handle at 110.33 within a long bottoming pattern, and has now rallied strongly enough to create a potential base-on-base pattern.
Also in the stock market today, Qualcomm (QCOM) rose nearly 0.7% to 66.95 and is trying to rally back above its key 50-day moving average. Qualcomm, which has plans to acquire industry peer NXP Semiconductors (NXPI), is also showing fine growth acceleration (EPS down 26%, then rising 17% and 41% in the past three quarters).
In the business software and entertainment field, Microsoft (MSFT) continues to show stunning strength. The megacap tech hopped 2.1% higher to a new high of 63.62, climbing further past a 58.80 buy point within a base-on-base formation.
Watch Video and Continue Reading at investors.com
Tape Reading the SPY ETF
$SPY price action pretty much took the day off.
These types of days call for your stock picking skills. $225 shows as the reference point for a bearish stand. The bullish side of the tape remains the correct bias but a trade below $225 has three dollars room to go.
The $222 level shows the next support. I can’t stress patience here. Since the election, swing traders and investors had a terrific stock market for longs, but day traders have needed to be on their “A” game.
If you’ve been frustrated, don’t make it worse by over trading now. If you’re day trading watch the levels we continue to monitor, change from the open, the current hour, and pay attention to topping tails on the daily chart.
Lighter volume wrecks breakout trades. If you get “shooting star” candlesticks (topping tails) on the daily, don’t buy the first breakout.
Wait for the pause on your intraday entries.
Stocks in Play: $NKE research on finviz.com
Nike (NKE) earnings preview: What to watch for as competition intensifies
Nike is facing headwinds from changing fashion trends and competition from Adidas and Under Armou
Nike Inc. is expected to announce fiscal second-quarter earnings on Tuesday after the market closes.
Nike NKE, -0.14% is facing heightened competition from Adidas AG ADS, +0.31% and Under Armour Inc. UAA, -0.92% as well as shifting trends that favor lifestyle fashions over athletic looks. But analysts remain optimistic about the Nike brand over the long term.
Among analysts, Nike shares have an average overweight rating and a stock price target of $61.52. That’s nearly 21% higher than Friday’s close.
Continue Reading at marketwatch.com
What To Expect From Nike’s Fiscal Q2: Back To The ‘Futures’?
Since Nike last reported quarterly earnings, a few things have changed.
America elected a new president, Adidas is back at the No. 2 spot in the U.S. athletic market and Nike’s upcoming second-quarter earnings release will no longer prominently feature its highly watched “futures” orders, a metric that has been known to move share prices.
Of those factors, the contentious election might be the least impactful on Nike so far. Shares have only slipped 0.6% since Nov. 8, though the stock has tumbled 19% this calendar year. Nike dipped 0.1% to close at 50.85 on the stock market today, dropping further below its 50-day line.
“I don’t think the election has impacted consumer demand, but many apparel retail stocks have traded down on concerns over possible changes to trade regulations,” said Morningstar apparel retail analyst Bridget Weishaar (who does not cover Nike), when asked about the impact of the election on the broader retail environment.
Read More at investors.com
Stocks to Trade 12-20-16 | Tuesday Edition
Short-Term Trading Momentum:
Positive the last 20 and 5 trading days | closed 2% higher from the open: CLVS, PE, CC
Negative last 20 and 5 trading days | closed 2% lower from the open: momo, alxn, lvs, srpt, wb, adnt, viab, trip, wynn, mbly
Quarterly Order Flow:
Bullish Stocks to Trade: LRCX, COST, WDC, HES, NVDA, BA, PNC, DFS, JPM, URI,M ACN, COF, KMX (EARNINGS TODAY), CMA, PRU, UNP, UAL, GS, IBM, CVX, X, VLO, BHI, UNH
Bearish Stocks to Trade: acad, viab, urbn, yumc, trip, rrc, crm, ua, htz, twlo, gps, teva, aem
2x Normal Volume: MDLZ, GPOR, CLVS, LEN
Inside days: abt, kmi, qcom, pg, dow, jblu, teva, dal, aal, unh, csx, rost, kss, adbe, mcd, cof, mar, tjx, ma, tgt, wdc, dd, ups, htz, yum