Today’s Trading Lesson…
One of the most challenging aspects of trading is to do nothing…
Especially for new, full-time day traders. We feel the need to be active because “this is what I do for a living.” If this is your belief, fight it and move beyond the label of day trader. You are a money manager in a short-term window.
You are a risk manager. You are in charge of when to allocate capital. You became a trader to make yourself money, not your stock broker.
Never forget your goal is to get paid, month-after-month. Notice I didn’t say day-after-day. Yes, that would be nice but you’re trading for the month. The reality is 60% of the month washes each other out, it’s the other 40% you must master.
Professional baseball players work the count and don’t swing at every pitch. They wait for a good one.
Work hard to do the same in your trading.
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On the Tape Today 2-1-17
BABA | Alibaba Group seems to be holding the $100 level after 3 bullish gaps after breaking the bearish order flow at the end of 2016. Planning a $101.50 buy-stop and an initial target of $104. If the stock market bounces and approaches new highs, looking for $108. A close below $100 stops out the trade.
SM | SM Energy breached the $31 support yesterday triggering a new sell-short. Planning for a $30.25 sell-stop and a new swing trade target to cover @ $25.25
Stock Market Today: Heatmap of the S&P 500
Stock Market Today 2-1-17 |Wednesday Edition
Trader Tries To Short Apple Earnings, Pukes Up Life Savings
On Tuesday, a day trader allegedly took gambling to a whole new level. And, if his act was in earnest, he lost big.
According to MarketWatch, Canadian investor F.S. Comeau bet his last $249,000 against Apple Inc. AAPL in an attempt to reclaim $2.5 million lost in poor investments. At the time of the trade, shares were valued around $122, and MarketWatch reported that an increase of just $6 would deplete Comeau’s savings.
Specter of Global Trade War Rises as Trump Puts ‘America First’
World leaders aren’t taking Donald Trump’s trade barbs lying down.
After the U.S. president said Germany and Japan are gaming foreign-exchange markets to win favorable trade terms, Japanese Prime Minister Shinzo Abe joined German Chancellor Angela Merkel on Tuesday in pushing back and leading a global counter-charge to the accusations.
Oil prices twist in two directions as production-cut uncertainty persists
Oil futures tipped higher but traded in choppy fashion on Wednesday as investors kept their eyes on progress for production cuts pledged by major oil-producing countries.
Apple considering legal action over Trump’s travel ban
Apple could be the next big tech company to take legal action against President Trump’s travel ban.
The iPhone maker is considering legal options regarding Trump’s executive order, which has affected hundreds of its employees, CEO Tim Cook said in an interview with The Wall Street Journal.
Leaked Executive Order Reveals Trump Crackdown On Immigrant Welfare
Seemingly following the proposals of Bill Clinton (and Ron Paul), The Washington Post reports that a leaked document shows the Trump administration is planning to crackdown on current, and would-be, immigrants who are likely to require public assistance.
Why Gold Has Upside
Which is why I am a bit confused by so many 2017 forecasts for gold prices to decline from current levels, in some cases dramatically. I guess I’m in the contrarian camp (Oh no, not again) because I think that if there is any risk in gold it is that it surprises to the upside.
London’s rivals roll out red carpet for bankers fleeing Brexit
From Frankfurt to Warsaw, European cities are preparing to welcome London’s bankers.
British lawmakers are expected to vote Wednesday to authorize Prime Minister Theresa May to start the formal process of pulling the U.K. out of the European Union.
Health insurer Anthem’s profit, revenue beat estimates
Anthem Inc (ANTM.N), which is fighting a U.S. government lawsuit to block its deal to buy Cigna Corp (CI.N), reported better-than-expected quarterly profit and revenue, helped by higher premiums and an increase in members.
The no. 2 U.S. health insurer said it expected 2017 operating revenue of $86.5 billion-$87.5 billion and adjusted net income to be greater than $11.50 per share.
Tape Reading the SPY ETF
$SPY one dollar bounce end of day continues to validate the concept of never fighting the order flow. Today we have a double whammy of earnings and the FOMC announcement.
Trading the morning becomes the game plan for most professional day traders until after the FOMC at 2pm. A few traders believe they can guess direction and get creamed. (I am sure professional options traders love the volatility)
The smart traders let the dust settle then jump back in.
NASDAQ remains the obvious long. Many retail stocks continue to see selling order flow but recently produced reversal days on heavier volume. I’m not calling a bottom there yet bu certainly something to note.
$227.75- $229.75 is the small window for a new trade long, until new highs are made.
What to expect when Facebook reports earnings
Since its last earnings report, Facebook Inc. has become somewhat of a political lightning rod.
But this week, analysts will pay closer attention to the company’s user numbers and engagement, as the company faces competition from Snap, parent of SnapChat, which is expected to go public as early as March, according to The Wall Street Journal.
What to Watch Wednesday: Fed Statement, Facebook Earnings
On Wednesday, the Federal Reserve releases a policy statement, while Facebook (FB) unveils its latest quarterly earnings. The Fed statement is released at 2 p.m. EST. Analysts don’t expect the central bank to announce a rate hike, although the statement will be parsed for clues on the timing and frequency of 2017 rate increases.
Facebook is building its own TV app to show longer videos
Facebook is building its own TV app to work with set-top boxes like the Apple TV, according to a report in The Wall Street Journal on Tuesday. The app would give Facebook a way to encourage its users to watch longer videos, a goal the company has already signaled in conversations with content creators and recent tweaks to the Facebook News Feed.
Stocks to Trade 2-1-17 | Wednesday Edition
Short-Term Trading Momentum:
Bullish Momentum: SRPT, TMO, ACAD, CC, CLVS, AGN, LLY, ALXN, VRTX, PCAR
Bearish Momentum: uaa, sm, ups, stld, vlo, nue, tso, rrc
Quarterly Order Flow:
Bullish Stocks to Trade: CLVS, SLCA, WDC, STX, TSLA, BABA, PNC, NFLX, ADBE, HD, IBM, LRCX, SWKS, LYB, BA, UNP, URI, NSC. AVGO
Bearish Stocks to Trade: uaa, xom, dks, trow, qcom, eqr, vfc, kss, hes, fslr, tgt, bmy, tjx, rh
2x Normal Volume: UA, UAA, UPS, VLO, TXN, MAT, NUE, SM, HOG, WA, VFC, PCAR, MUR, ABC, TMO, DKS
Inside days: mu, mat, pypl, nvda, dis, cvx, cop, mur, hal, stx, oxy, apc, low, nflx, cf, nbl, pm, hes, wba, amzn, bhi, swks, mbly, twlo, urbn, adbe