Today’s Trading Lesson…
Beginner Trading Advice | Mentoring Experience
What is the best beginner trading advice you would give yourself? A common question I get…
The answer may surprise you. It’s most likely the answer you don’t want to hear.
You probably want to hear about the money you can earn stock trading. If you buy a “how to trade stocks” book, you skip to the entry signal chapter. After all, perfectly timed entries create winning stock trades.
Well, to put it bluntly the answer is no.
On the Tape Today...
$AAL nice breakout with volume. Buy-stop @ $39 profit target is $41.75 (see chart)
$NCLH short-sale below $35 with a swing trade target to cover @ $30.25
$VLO head and shoulders bottom with a neckline breakout >$56.25. Ultimate target is $62.
$STX provides an other bullish gap but resistance @ $37. Keep it in your watch list for a move to $42.
$AAL 9-8-16 (Click to Enlarge)
S&P, Dow fall, Nasdaq posts record close after Fed report, Apple event
The S&P 500 and the Dow lost a little ground Wednesday, after a report from the 12 Federal Reserve districts had a modestly positive tone about the economy but noted that the presidential election is making some firms cautious about expanding activity.
But the Nasdaq Composite eked out a gain and closed at a record high as tech stocks rallied, helped in part by Apple Inc. AAPL, -0.61% which rose 0.6% after unveiling the iPhone 7 at its flagship product event in San Francisco.
The Fed’s latest beige book report, meanwhile, was viewed as providing more fodder for the central bank, as it contemplates an interest-rate increase in the near term.
Stock Market Today: Heatmap of the S&P 500
Stock Trading Today 9-8-16 | $CMG ACKMAN
Stocks’ Follow Up Is Hesitant, But Small Caps Pop
U.S. stocks showed second thoughts Wednesday, tentatively rising and dipping a day after the Nasdaq posted a new all-time high. Facebook (FB) posted a gain for a fifth consecutive session.
The stock broke out Tuesday in volume 32% above average and padded the gain Wednesday. Health savings account manager HealthEquity (HQY), up 2%, rose a third straight session, lifting the small cap stock further above the 5% buy zone from an Aug. 29 breakout.
Tape Reading the SPY ETF
$SPY volume starting to come back, a good sign for potential volatility.
Be careful sizing up too soon. The general market is smack in the middle of a trading range. The big line continues to point to an uptrend, but expectation for follow through is lower while in the range.
That means mostly trading for cash flow unless your stock is breaking levels. (See $FB the last ten days)
Stocks in Play: $CMG research on finviz.com
$CMG NEWS: Should You Follow Ackman Into Chipotle?
Last month we looked at 13F filings. These are the quarterly portfolio disclosures, required by the SEC, of large investors–those managing $100 million or more. And we discussed 13D filings.
These are required when a big investor takes a controlling stake in a company (ownership of 5% or more of the outstanding stock), he is required to disclose it to the SEC, through a public filing within ten days over crossing the 5% threshold.
If it’s a passive investment, they file a form 13G. If they intend to engage management (i.e. wield influence) they file a 13D. Bill Ackman, the well known billionaire activist investor, filed a 13D on Chipotle (CMG) yesterday.
Today, we’ll take a look at this move.
Cramer: The Timing of Ackman’s Chipotle Purchase Is Pretty Fabulous
The calendar of restaurant-related sickness says you can’t wait much longer than one year after an incident occurs to start buying the stock of the offending chain.
Therefore, the calendar says that Bill Ackman’s Pershing Square will be right with his timing of his 9.9% position that he’s taken in the beleaguered Chipotle’s (CMG) stock.
It’s been tough to try to figure out the tolling period where Chipotle’s bad press began and where it ends. That’s because reports of the initial outbreak of E-coli in Oregon and Washington occurred Oct. 26 last year, but the CDC didn’t opine on the story until Nov. 20 when it stated that 45 people had gotten sick in six states.
Stocks to Trade 9-8-16 | Thursday Edition
Short-Term Trading Momentum:
Positive the last 20 and 5 trading days | closed 2% higher from the open: SRPT, HCA, RH, TSO, AAL, UAL, WDC
Negative last 20 and 5 trading days | closed 2% lower from the open: gis, jci, rcl
Quarterly Order Flow:
Bullish Stocks to Trade: PXD, CHTR, FB, TIF, LRCX, CLR, GS, BIDU, APC, EOG, AMZN, SWKS, BABA
Bearish Stocks to Trade: rcl, nclh, dltr, hes, bmy, crm, juno, esrx, gild
2x Normal Volume: CHTR, CTRP, WDC, APA, JCI, VMW, DG, GIS, CCI, MCHP, MOMO, TSO
Inside days: se, baba, c, wfc, ms, jd, hes, myl, nflx, bby, crm, tgt, jnj, met, pm, bhp, kim, clr, mar, cbg, hlf