Today’s Trading Lesson…
The most common question I receive at trading seminars and during mentoring is “What books should I read?”
My answers usually have the same four:
- Reminiscences of a stock Operator (Edwin Lefevre)
- Trading to Win (Mark Douglas)
- Mindset (Carol Dweck)
- The Market Makers Edge (Josh Lukeman)
All solid trading books. The stage in your career will dictate the book that provides the greatest impact.
But if I had to recommend one book and one book only, it would be your trading journal. No trading book will do a more effective job of teaching you what works, and what doesn’t work.
Most traders stop writing after a few months. Be diligent. You’ll be glad.
On the Tape Today...
$WYNN bullish close and solid volume shows relative strength in a weak tape. Look for one more day to be a buyer. (see chart)
$MET and $PRU bullish breakouts remain in play. One day of selling doesn't change the order flow.
$DIS sell-short remains a valid trade for both swing and day traders. Ultimate target to cover is $87.
$NKE well-offered for two days out of an inside day breakdown. Look for one more day on the short side with a $54 target.
$WYNN 9-12-16 (Click to Enlarge)
Dow futures slump more than 100 points as rate-hike fears linger
Investors hope Fed dove Brainard can calm market fears
Wall Street looked set for another day of market carnage on Monday, as fears the Federal Reserve will soon raise interest rates continued to spook investors out of risky assets, such as equities.
Traders were waiting for a speech by Fed dove Lael Brainard later in the day, hoping she could dispel concerns a rate increase is imminent.
“Previous falls have seen a wave of liquidity move into the market to buy on any weakness, but the volume of concerns — in particular in relation to central bank support — is making it far more difficult for investors to simply brush off this latest downturn as an opportunity rather than a threat,” said Rebecca O’Keeffe, head of investment at stockbroker Interactive Investor, in a note on Monday morning.
“The major hope for investors rests with the Fed’s resident dove, Lael Brainard, whose speech today takes on even more significance, amid hopes that she will maintain her dovish stance and ease market fears for next week’s Federal Reserve meeting,” she added.
Stock Market Today: Heatmap of the S&P 500
Stock Trading Today 9-12-16 | $TSLA AutoPilot
Stock Market Plunges Amid Rate-Hike Fears; Apple Breaks Key Support
Stocks sold off hard Friday as the market anticipated rate hikes following comments by Fed officials. All 30 Dow components finished lower, while Apple breached key support.
Oil, gold and steel stocks were among the biggest losers in the stock market today, as the price of West Texas Intermediate oil sank to $46.47 a barrel — down 4% Friday, but still up nearly 5% for the week.
Gold futures shed 0.7% on Friday to $1,332.80 an ounce. Boston Fed chief Eric Rosengren’s remarks that he’s in favor of gradual rate hikes were enough to send the market into a downward spiral.
The Dow was a sea of red, with Verizon Communications (VZ), Boeing (BA), Caterpillar (CAT) and Coca-Cola (KO) leading the bloodbath with declines of more than 3% each.
$TSLA | Tesla CEO Elon Musk touts big improvements to self-driving car systems
Tesla CEO Elon Musk says the electric car company is making major improvements to the Autopilot system used by its vehicles, which will dramatically reduce the number and severity of crashes in which they are involved. READ MORE — >>
Tape Reading the SPY ETF
$SPY traded over 200 million shares and closed on the lows. One day doesn’t change bullish order flow, but the price action and volume certainly gets your attention, especially if you’re a long only trader.
Futures are trading lower this morning (6:30 am). Expect follow through but don’t be so quick to short and hold. You need a reference point to accept risk on the bearish side. Day traders should use the current hour.
Swing traders are jumping the gun unless you are allocating small shares and building a position.
We received several emails over the weekend about Friday’s price action. Without knowing you, the best advice I can give you is track price and volume every day. Trading success relies on you knowing these relationships.
Trading is more than chart patterns. Reading the tape means you see beyond the price.
Stocks in Play: $TSLA research on finviz.com
$TSLA NEWS: Elon Musk: New Tesla self-driving upgrade could have avoided crash
Tesla Motors said Sunday that it is going to upgrade its Autopilot semi-self driving system in a way that will make its electric cars more dependent on radar, rather than cameras, and improve its accuracy in being able deal with hazards.
Musk painted the new system as a “dramatic improvement,” one that could make Teslas in Autopilot mode up to three times safer than vehicles without the system.
It shows not only that Tesla is committed to leading when it come to the development of fully self-driving cars, but that it willing to take action after the Florida crash.
Musk Says Tesla’s New Autopilot Could Have Saved Driver’s Life A fresh version of Autopilot software that Tesla Motors Inc. unveiled Sunday emphasizes radar over cameras to guide semi-autonomous cars and potentially could have saved the life of a driver in May, Chief Executive Officer Elon Musk said.
The biggest change in Autopilot version 8.0 is a new starring role for radar, which since October 2014 has only been used to supplement camera sensors, Musk said in a blog post Sunday.
Stocks to Trade 9-12-16 | Monday Edition
Short-Term Trading Momentum:
Positive the last 20 and 5 trading days | closed 2% higher from the open:
Negative last 20 and 5 trading days | closed 2% lower from the open: x, jci, ctrp, hal nem, low, pm, gis, hd, cat, hes, ba, mos, ctsh, avgo, utx, celg, amzn, tsla, nue, kmx, duk, rost, fslr, hog, k, kors,
Quarterly Order Flow:
Bullish Stocks to Trade: PRU, APA, LVS, LNC, STX, URBN, COF, PNC, CHTR, MA, LNG, APC, FB, BABA, UAL,
Bearish Stocks to Trade: viab, ions, juno, hes, fslr, low, eqr, bmy, cost, dis, myl, cvs, teva, esrx, gild, dltr, dg, nclh
2x Normal Volume: JCI, RH, CTRP, APA, MON, SWKS, WYNN, CCI, DLTR
Inside days: gild, se, nbl, hfc, cof, wnr, endp, hrb