Today’s Trading Lesson | 7-15-16
How do you decide your trade management?
How do you know when to build a position, versus when to trade for cash flow? For most traders it’s a random decision.
A simple technique I implement is called “commitment.”
How much money is committed to your trading idea? I am not talking about your money. I am talking about your stock and it’s recent price action.
Is your idea based off the last 3 days of momentum? Is your idea in the same direction as three months worth of buying? The answer will dictate your commitment.
The more big money committed to your idea, the more conviction you should have. Trade management is decided before the trade, not after.
On the Tape Today...
$KMI a solid momentum move but notice the exhaustion volume yesterday. (see chart)
$UAL, $AAL short covering rally, looking for a sell short today. (only on a higher open)
$CAT buy stop limit over $81. Will most likely pull back to the $78.50 area first. Keep on your radar.
$VLO short sale still in play. Initial target of $47.
$KMI 7-15-16 (Click to Enlarge)
U.S. stock futures slip as traders reflect on France terror attack
U.S. stocks were set to fall from record highs on Friday after a terror attack in France left more than 80 people dead, overshadowing better-than-expected growth data from China.
The dip lower came in the aftermath of Thursday night’s killing of at least 84 people in Nice, France, when a truck driver barreled through Bastille Day revelers who were gathered at the Promenade des Anglais in the Riviera city.
French President François Hollande said the scene had “undeniable traits of terrorism,” and he extended the country’s state of emergency that’s been in place since the Paris terrorist attacks in November. The truck driver, believed to be a 31-year old French-Tunisian, was shot dead by the police. No group has claimed responsibility for the attack.Read More — >>
Stock Market Today: Heatmap of the S&P 500
Stock Trading Today 7-15-16 | $C Earnings
Apple, Goldman Send Dow To Fresh High; Line Is 2016’s Hottest Tech IPO
Stocks resumed their rally Thursday after taking a bit of a breather in the prior session. Goldman Sachs and Apple boosted the Dow industrials to a new record high, while Japan’s Line scored the biggest tech IPO this year.
Goldman Sachs (GS) gapped up and rose 3% in above-average volume, extending its win streak to seven as the stock nears its 200-day moving average. The big bank reports quarterly earnings next week. Fellow Dow component JPMorgan (JPM) added 1.5% after reporting solid Q2 results. The Bank of England’s surprise decision to leave a key interest rate unchanged at 0.5% also gave banks a boost.
Apple (AAPL) popped 2% in normal trade. Shares have risen in six of the past seven sessions. The iPhone maker’s stock has rebounded 11% from its May 12 low and remains 25% off its 52-week high.Read More — >>
Tape Reading the SPY ETF
$SPY continues to close higher, but below the open. The tape is showing the bulls are still in charge, but they are clearly tired.
Long is the correct play. Because the market is overbought, you should be in cash flow mode. Building a position is not the smart play here.
Stocks in Play: $C research on finviz.com
$C NEWS: Citigroup Stock Declines Ahead of Q2 Earnings (C)
Citigroup Inc. (C) is set to report second quarter fiscal 2016 earnings results before the opening bell Friday. Citigroup shares closed Wednesday at $43.33, down 0.25%. This translates to a rise of 5.53% over the past five days and 2.08% declines over the past three months. Wall Street expects the money-center bank to deliver year-over-year declines in both revenue and profits.
Expectations for the Quarter
For the quarter that ended June, Wall Street expects the New York-based company to deliver earnings of $1.10 per share, down from $1.51 a year ago, on revenue of $17.47 billion, down 8.8% year-over-year. For the full year, ending in December, earnings are projected to decline 15% year-over-year to $4.52 per share, while full-year revenue of $69.97 billion would mark a 8% decline from the year-ago period.
In its first quarter earnings, reported in April, Citigroup beat analysts’ estimates on adjusted earnings per share and on revenue.Continue Reading — >>
Stocks to Trade 7-15-16 | Friday Edition
Short-Term Trading Momentum:
Positive the last 20 and 5 trading days | closed 2% higher from the open: WMB, UA, AAL, WPZ, MOS, K, SLCA, NEM
Negative last 20 and 5 trading days | closed 2% lower from the open: acad
Quarterly Order Flow:
Bullish Stocks to Trade: YUM, SLCA, CAR, IBM, AMGN, CLR, CHTR, EA, CAT, CVX, HON, AMZN, UNH, LRCX, AEM, DLR
Bearish Stocks to Trade: psx, vlo, fslr
2x Normal Volume: MET, MON, YUM, NXPI, HFC, K, BLL, DKS
Inside days: fb, emc, abt, cop, dvn, teva, gsk, slb, fast, low, hd, lvs, hes, clr, tsla, pten, mbly, mar, joy, nov, jwn, coh, apa, rost, crm, kors, dg, adbe, bbby