Showing posts with label new highs. Show all posts
Showing posts with label new highs. Show all posts

Monday, July 13, 2015

Chart of the day: AMAZON and the new high breakout

Amazon is setting up as a new high breakout entry. The stock is currently above it's earnings breakout level, which sets it up in a "new box" above the $415-445 range.

A close here could set it up for a run to $500.

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Friday, January 30, 2015

The Common Sense Approach to Swing Trading Apple: A Measured Move

One of my favorite swing trade setups is the earnings breakout.  I know, we have established that in post after post.  What you guys really want to know is how does The Market Speculator plan to trade Apple!

I've got your back fellow swing traders.  Trading Apple, and making a profit from it, is like a badge of honor.  Call your significant other up and tell them you traded Regular Therapeutics, and they will fall asleep before you even get to the profit talk.  But Apple, now everybody wants to hear about an Apple trade.

Any time I look to make a swing trade, I search for a stock with a catalyst.  AAPL has that, blowing the roof off earnings two days ago and gapping up on heavy volume.



Price is currently at $118.90, about a dollar away from the all time high.  That is the key level.  The last time AAPL broke out from an old high, back in mid-October, the stock went on a 15 point run in just under a month and a half.

History tends to repeat itself and I would not be surprised to see a similar run once AAPL clears the recent high.  The $120 level is the buypoint.  This entry level provides low risk and high reward, which is the most important of our 23 laws of trading.

So there you have it.  The common sense approach to trading Apple.

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Thursday, August 20, 2009

CX Chart

CX has a great looking chart that shows strong accumulation (volume pattern) and is breaking out to highs. The stock is extended, so I will wait for a pullback for entry.

Friday, July 17, 2009

The Short Apple Setup

AAPL is showing a negative divergence and is extremely extended at new highs. I am short with a tight stop.

Sunday, February 08, 2009

Energy Looks Good: PBR

Energy stocks are showing good accumulation patterns while coming off bottom price patterns. Of the energies that I monitor, PBR is showing the best relative strength compared to the sector. It is at 30 day highs.  I'd like to enter on pullback to support.

Tuesday, May 22, 2007

Today's Trades and Analysis: GMRK and DXPE

I sold 400 shares of GMRK at $53.85 (entry at $49.76) for a $1636 gain (+8.2%).


I sold 500 shares of DXPE at $52.35 (entry at $47.40) for a $2475 gain (+10.4%).


Self Analysis:
These trades are good examples of how I have grown as a trader. Last year, I would have most likely taken profits before my profit target, which was just under the recent high in both cases. Instead, I sent my targets right after I took my positions and fought the temptation to micro-manage the trades. The result was a combined +18.6% gain, rather than what would have likely been an 8-10% gain.

Trade Analysis:
Without going into too much detail, both of these trades offered nice breakout-pullback setups. I entered at support, which was at the bottom of the breakouts, just under price congestion.

While I am not very precise with entries, I am becoming much more focused on exits. Here, I timed my exits just under the recent highs, where there would likely be some panicked traders who bought the stocks at the high and watched it pullback.

As you can see from both of today's charts, that is exactly what happened. The stocks dipped right after hitting my profit targets.

After I have taken profits at the highs, I do not dump the stock off of my watchlists. If the stock bases and then breaks out above the old high, I may re-enter on the breakout, or allow the stock back on the breakout-pullback watchlist, in hopes for a pullback to what now is the old high.

I am still holding STLD, ZUES, SYNL and IBN

Friday, April 20, 2007

Breakout Chart: XOM

Exxon Mobil Corp. (XOM) broke out to new highs on above average volume. A low volume pullback to the prior highs, just under $79, would normally provide a good entry point.

While the breakout is bullish, there are some concerns for this stock. Notice the negative divergences in both RSI and stochastics. One would expect new highs in RSI and stochastics when price hits new highs, but here the two indicators are trending down. While this is not bullish, I would not short until confirmation of the divergence. If price pulls back below the old high, we might see a quick short opportunity.

Playing armchair quarterback, it's easy to see a missed opportunity for entry at $76. Here we had atextbook breakout from a "W" bottom formation.

Sunday, March 11, 2007

New High Failure Trade and AAPL

One of my favorite short plays is the "new high failure" trade. There are three elements to this trade:

1) That stock makes a new high
2) RSI peaks at a lower level than the previous high
3) Take a short position if and only if the stock dip below the previous high

The recent failure of AAPL is a good example of this setup. The stock broke out to new highs in January. Many breakout traders saw this as a sign to jump on the Apple bandwagon. However, the fact that RSI peaked at a lower level than the November high was a warning sign. While not a signal to short, it was a warning that the stock should go on the "new high failure" watchlist. The optimal entry was few days later, when th stock gapped down below the old highs.


With so many stocks way below old highs, there are not many "new high failure" plays setting up right now. However, there are a number of stocks bouncing up to the old high resistance level. I will be watching this level for short entries. Maybe we can call this a "double" or "bounce" failure. For example, AAPL is inching up to the old high level on declining volume. If the stock fails at this level, which is likely, we could see another leg down.