Thursday Plan and Trade Report

Here is the the detailed report I sent to subscribers last night:

Market Notes:

As price consolidates, the volume pattern is getting more and more ominous. Today's volume has turned me from neutral to slightly bearish on the market. I am more inclined to take on short positions on the focus list.

Those looking to take a low risk setup long on the SPY got the chance that was talked about last night, as price dipped below $105. If entered at $105 with at stop at $103.50 and target at $108, that's a 2:1 reward to risk ratio. I did not take the trade, but it was there for those who don't mind taking a small loss with the opportunity of 2:1 risk ratio.

Trade Tracker:

I am still holding AMZN, BIDU and STEC short, along with bearish positions SKF and SRS. I am holding APOL long.

Setups:

Watchlist stocks from yesterday are still being watched: FSLR, IEX and gold stocks. Bearish stock STEC.

BIDU, a stock I am currently short and have already taken partial profits on, still looks vulnerable. Notice that, while volume hasn't reached upmove levels, it has steadily increased on the pullback. A pullback to price and moving average support would not surprise me. Stop levels are tricky, but since the target is at $360, even a stop near $410 would give 1.5:1 risk.

Bird flu play SVA has been a tough entry post breakout, but gives us a decent support level now for which to place a stop. Entry here at $8.20, with a stop at $7.20 and target at pivot high of $11-12 gives a nice 3:1 risk ratio.

This setup is problematic because the bottom of the breakout bar is $7 and moving average is $6.76. If the stop is loosened to $6.50, the risk ratio would be closer to 2:1. Not as good but gives more latitude to stay in the trade.

Game Plan and Free Trade Report

Here is my game plan for the rest of the week and free trade report. Watch for the key SPY support levels. A continuation of the down move would setup some nice "oversold bounce" trades.

http://docs.google.com/Doc?id=d5z8q8w_1296ffhsmdfn

September 2, 2009

Note: I will not have access to a computer Thursday and Friday while on vacation, so there will be no Reports or intra-day notes for those two days. The next report will be for the first trading day next week.

Market Notes:

Today's welcome continuation down move (for those of us net short) broke through last week's support zone and sets up a possible move to the next support zone at $98.

If looking to add short positions, look for a weak bounce to former support. If looking to get long, wait until the $98 support zone is reached. This would setup a nice oversold bounce trade, with stochastics reaching oversold conditions.

Trade Tracker:

I am still holding all of my short positions but LMT, though using profit taking strategies to lock in profits and still benefit from a possible down trend.

I took partial profits in AAPL and VPRT. I am still holding SNDA and POT, which are now partial positions after profit taking.

I exited LMT. It has not been cooperating. The fact that it has not participated in the market down move, even with a nice short setup is what got me to give up on the trade.

I was stopped out of my SSO and SPY long partial positions at my entry levels. Profits had been taken earlier at the top of the trading range (see past reports). I am happy with this SPY trade as it allowed me to make some profits while waiting for my short positions to work.

Game Plan:

Keep and eye on index and focus list stocks. Shorts can be added on a weak bounce. Longs can be added on weakness, when SPY reaches support.

If the market continues to drop, keep the "oversold bounce" and "rubber band" setup handy. Look for stochastics that reach below 10, price moving far from resistance and big drops to support.

Keep an eye on key support and resistance levels, along with stochastics. This should make for some easy, slam dunk trades.

Trading Strategy:

While I don't have my full setup, I will have my iphone and will monitor the index ETFs and core focus list stocks. This is a good strategy when away from your usual trading setup or on vacation. SSO and SDS will be the main trading vehicles, with focus list stocks as possibilities.

Monday Game Plan and Free Trade Report

To see the report with charts, click here

August 24, 2009

Market Notes:

In the law there is a term called "de novo", which means to consider a matter anew. It's commonly used when an appeals court reviews a lower court decision. The appeals court can review the case with a fresh pair of eyes.

I like to think of my weekend review of the markets as a "de novo" review. I throw out my previous analysis and biases, and start from scratch. Let's do that with the market.

On the short term chart, SPY has broke out over recent highs on decent volume. This looks to be a good breakout-pullback setup. While I entered on breakout Friday, I'd like to add more on a dip.

My previous bearish take has been invalidated, as the dip turned out to be a pullback rather than start of a deeper pullback. This is surprising, as last Monday and Tuesday were very bearish moves on strong volume. If we were stubborn here, we'd hold onto the past and say to ourselves, "the market has to go down". We cant play that game.

However, note that if the recent highs are pierced to the down side (especially on a close), that would invalidate the breakout and the "failed breakout" setup would emerge.




Now let's look at the longer term 1 year chart. We see a really nice looking bottom pattern that's take a year to form. We are now near a major resistance level, the gap down zone in the $105-110 range. This will be a good area to take some short positions.




Game Plan:

Buy the dips. Look to get short on a rally into the $105-110 zone.

Trade Tracker:

I entered SPY on the breakout. As I noted on Thursday, we were in a trading range and a break in either direction would clue is in on how to position ourselves. A good strategy when waiting for a level to break is to place a buy entry at that level. I had buy entires placed at the bottom of the range for a short trade and the top of the range for a long trade.

I entered 500 shares of SSO at $31.80 , and 200 shares of SPY at $102.

I was stopped out of my SDS position. I am still short LMT, AMZN, POT and VPRT. Note that while SPY is breaking out to recent highs, my short positions are not. They still could get taken up with the market, but this does tell me that these were good short positions.

Focus List:

The easy trade right now is to just focus on the indexes. You can gain volatility by trading the leveraged ETFs.

SSO, DDM

The only non-index trade I am looking to make tomorrow is LUV. It looks like it may be done pulling back after a strong uptrend. The moving averages are about to cross and the trade is easy to manage with a stop placed at the pivot low.




Shorts: Focus list stocks BCSI, AAP and SNDA

Disclaimer: All information and opinions expressed in this report are to be used for entertainment purposes only. The author of this report is not an investment adviser and does not give buy, sell or hold recommendations. Trading stocks is a risky undertaking, and due diligence is required before making a trade. Consult an investment professional before making a trade. The information in this report is not verified and may be incorrect. The author of this report may or may not hold a position in stocks mentioned in this report.

Monday Game Plan and Free Trade Report

Here is the strategy I laid out for subscribers to start the week:

http://docs.google.com/View?id=d5z8q8w_1205gxt3rxp3

The market is in a very bullish made right now. As we can see on the SPY chart, RSI confirms the recent breakout over resistance, as it makes new highs along with the index. The volume patterns shows there's some real velocity behind this move, as price is being pushed by some real volume. It's not supercharged, but steadily increasing.

The market is overbought, so entry is not optimal until we get a pullback to support. At that level, one could enter SPY or SSO for extra leverage.

If by chance the market continues to ramp up, we can take another stab at the oversold bounce or rubber band trade. If SPY bounces close to $100, I'll look to take a quick short trade with a tight stop.

Trade Tracker:

I was stopped out of the X trade on Friday.

Focus List:

A few specific short setups with triggers:

Some stocks are showing extreme overbought conditions and setup as "rubber band" short setups on a bounce.

AAPL is stretched about as much as it has been over the past year. Notice that it is piercing the bollinger band and showing extreme overbought conidtions. It's not just oversold, it's extremely oversold. If it bounces again tomorrow ($162-165), I'll look to get short. Only on bounce, which would make a pullback almost inevitable.

SRS is an inverse ETF. While it is a bearish trade, we have to look at it as if we are going long. As with AAPL, it is at extreme levels, but I'd like it to get more extreme. A dip tomorrow to around $16-$16.25 and I will enter.

AMZN is a "failed breakout" trade. The stock broke out of major resistance with a huge price bar and major volume, only to breakdown the following day in equally powerful fashion. I will look to short on strength tomorrow. Stop should be around $91. Low risk, high reward.

Long watchlist

Remember that the market is overbought so I'd like to wait a few days for most long entries. Here is my watchlist:

breakout-pullback candidates: SBUX, NFX, POOL, TXI, ALB, ISRG, CELG

Hot stocks showing accumulation (many commodities): BHP, PCU, NOV, RIG, FCX, ACI, GRMN, RL

Hot sector: Solars are looking really good in terms of price and accumulation. They can turn on a dime and are volatile, but I'd like to take a position on pullback of one of the following: SOLF, SOL, CSIQ or FSLR.

Disclaimer: All information and opinions expressed in this report are to be used for entertainment purposes only. The author of this report is not an investment adviser and does not give buy, sell or hold recommendations. Trading stocks is a risky undertaking, and due diligence is required before making a trade. Consult an investment professional before making a trade. The information in this report is not verified and may be incorrect. The author of this report may or may not hold a position in stocks mentioned in this report.

3 Week Free Trial to the Trade Report

I am offering a 3 week free trial to my nightly Trade Report. The Trade Report features my current market outlook, updates on my own trades and my focus list which tracks the stocks I am looking to trade the next day. It is the journal I prepare for myself in preparation for the coming day. I also occasionally supplement the Report with intraday trade alerts.

You will have to sign up to the report via paypal through the link below. If at the end of 21 days you do not want to subscribe, simply e-mail me and I will refund the subscription payment.

The free trial will also include *archives* to reports going back to January 1, 2009.

Sample reports:
http://docs.google.com/Doc?id=d5z8q8w_826f9n94jdv

http://themarketspeculator.blogspot.com/2009/01/monday-game-plan.html

http://themarketspeculator.blogspot.com/2009/04/mondays-game-plan.html

Monday's Free Trade Report

Here is the report I sent to subscribers to start the trading week.

http://docs.google.com/View?id=d5z8q8w_1145dtxkzjcp

A lot more longs than shorts, which is a clue for the overall market.

What You Need to Know About SPY's Change in Character

My recent bias has been short term bearish, intermediate term bullish.  Short term, the character of the market seems to be changing.  Price made a strong reversal on Friday on decent volume.  More importantly, price pierced through the 200 day moving average.  This is bullish.  

The negative volume pattern is slowly losing steam.  While not quite bullish, recent volume puts the distribution pattern in question.

On the chart below, notice that from the start of 2009 to now a "cup and handle formation" has emerged.  This bullish pattern often sets up a continuation pattern off bottoms.  

RSI has changed in character.  It recently made highs and now steadily resides in the to half of the range.  

As we can see, things are looking quite bullish.  So does that mean it's time to go "all-in"?   No, it's not.

There still are some concerns.  The 2009 high is two points away.  This could provide resistance.  Also, in a perfect world, volume would have picked up more than it has during the latter half of the bottom formation.  

A long trade still can be made, but I am still not going with a big position size.  Risk should be managed closely in case of pattern failure, which is a distinct possibility.  

Three SPY Trades

1.  Wait for pullback to bottom of range ($88--89).  Place stop below 50 day ma ($86).  Targets at $95 and $100 (see longer term chart).

2.  Enter now, above the 200 day ma ($92).  Place stop under Friday's price bar ($90).  Targets $95 and $100.

3.  Enter now, with stop under 50 day moving average.  To justify risk, target must be $100.  This is a longer term trade.

This was on excerpt from the Monday's Trade Report. Subscribe to receive the report 4-6 times per week, featuring my nightly journal, market outlook, focus list and trades.

Monday's Game Plan

Here is the report I have sent to subscribers laying out my plan for Monday:

Market Notes:

Let's go over the state of the market on different time frames.  

The long term trend is bearish.  We are still in a bear market.  While I have not posted a long term chart, notice that the 200 day moving average (which comes into the chart in the top right corner and is red) is still sloped downward.  The slope of a moving average is an easy way to identify trend.

In the intermediate term, the market has reversed and is bullish.  There are three clues that identify this time frame as bullish.  First, the strength of the recent price trend.  During this trend volume has been positive, which signals strong accumulation.  Finally, the 50 day moving average is no longer sloped down and looks like it's about to turn upward.

On the short time frame, the market is slightly overbought.  The stochastic readings are 80 and 74, which signal overbought markets.  However, in strong uptrends I look for a stronger reading for shorts.

How do we use this information?

Since I do not trade on the long term time frame, I pretty much ignore this information (though I do use it for my longer term portfolio).  I am focused on the intermediate and short term trends.  With a bullish intermediate term trend, but an overbought short term trend, I wait to initiate shorts.  I look for a pullback to support and moving averages.  For shorts, I wait for extreme overbought readings to initiate shorts.

Bollinger Bands and Extremes:

I don't post bollinger bands on most charts because they tend to confuse many of my readers.  The reason for this is much of the published material on Bollinger Bands contend that touches of the bottom or top of the bands should be used for reversal trades.  I disagree with this.  Bollinger Bands are very complex and act different in different markets.  In a strong trend, a touch of the Bollinger Band can signal continuation of trend.  We only need to look at the band from February to March to see this.  

I use the band for "extreme" reversal trades.  In trending markets, I only use Bollinger Bands for reversal trades when the band is strongly pierced (rather than just touched).  My own backtests have shown a 15-20 percent increase in win rate when using this method (though trade frequency decreases, and identifying trend for this trade is subjective).

Right now, we are moving along the upper band but it has not been pierced   A strong move to the $90 range would not only likely pierce the bollinger band, it would also create an extreme stochastic reading and move right into strong resistance.  This would be an excellent shorting area.

The bollinger band can also be used as an entry for trend pullbacks.  The BB mid-point is the 20 day moving average, which many traders look to for support.  A pullback to the $82-83 range would provide a good entry level.

Game Plan:

Short strength, Long on pullback.

Trade Tracker:

I have no open trades.

Focus List:

Since we are not near any long entries, I am not putting any charts up tonight, though I am posting the entire focus list.  The only charts are for short entries.

Longs:  

Financials, residentials, industrials, metals (not including silver and gold), retail and select tech all show strong relative stength, price and accumulation patterns.  Stochastic readings are included in the list below.  I'll narrow the list as we get closer to entry points.  

Shorts:

Setup:  Triangle Breakdown-Pullback.  Enter on pullback to the top of the breakdown bar, which also corresponds with moving average resistance.

Disclaimer:  All information and opinions expressed in this report are to be used for entertainment purposes only.  The author of this report is not an investment adviser and does not give buy, sell or hold recommendations.  Trading stocks is a risky undertaking, and due diligence is required before making a trade.  Consult an investment professional before making a trade.  The information in this report is not verified and may be incorrect.  The author of this report may or may not hold a position in stocks mentioned in this report.

 

www.themarketspeculator.blogspot.com

Free Trial of the Trade Report and Free Private Chat

I am offering a one week free trial to the Trade Report for those that interested in subscribing, along with a *half hour private chat* with me.

You will have to sign up to the report via paypal through the link below. If at the end of 7 days you do not want to subscribe, simply e-mail me and I will refund the subscription payment.

The free trial will also include *archives* to reports going back to January 1, 2009 and a *free half hour private chat* with me, where you can discuss anything market related.

Last Night's Trade Report

Here is the Trade Report I sent to subscribers last night. In it is also a link to Monday's report, which is probably more important.

http://docs.google.com/Doc?id=d5z8q8w_828pc9n57gv

Monday Game Plan

Here is my game plan to being the week. This is taken from the Trade Report, sent today to subscribers:

January 26, 2009

1.  Market Notes:

While the focus of my swing trading style is daily charts, I look at a few weekly charts every Sunday.  I do not use the weekly chart for specific entry, rather to help me define major support and resistance levels.  

On the SSO chart below, we see two key support levels.  The first is the November low (around $18).  The second is the bottom of the trading range formed at $20.  The other lines on the chart are resistance lines, which can be used as targets.  

Technically, SSO is almost oversold on the weekly (note that it is not on the daily) and RSI shows a positive divergence.  I didn't market it on the chart, but notice that RSI is higher now than it was at the previous low.

 

Entry conditions:

A.  Intermediate term time frame

Traders with an intermediate term time frame (a few months) can enter here with a stop below the November low.  The initial target is the top of the trading range.  If entered at $22, with stop at $17 and an initial target at $30, the initial reward to risk is 2.67:1.  Waiting for a pullback would offer even better risk.

If the trade works, and the $30 target is hit, I would take partial profits, move my stop up and move my target to $35.  

B.  Short term time frame

Traders with a short term time frame should use the bottom of the trading range, not the November low, as the stop level.  I would look to enter on weakness, possibly around $21, with a stop under $20 and initial target of $25.  an entry at $21, with a stop at $18.90 and target at $25 would give a 2.5:1 reward to risk.  Setting the stop at $19.90 would give an even better risk ratio,.  I use a wider stop because of the increased market volatility.  

If stopped out of this trade, I would look to re-enter if the market tested the November lows for another quick, low risk trade.  If the target is hit at $25, I would take partial profits, move my stop up to entry level, and target to $30.

Trading Note:  I am focusing on risk for these trades.  Since the market is not at extreme oversold levels (T2108 and stochastics are not extreme yet), the probability of the trades working is not as high as if we tested the November lows.  This would create extreme conditions for T2108 and stochastics.  I label the SSO set above as low risk, average probability. 

2.  Sectors ETFs: 

Here are a few sectors that look promising.  You can trade individual equities within the sector, or just trade the ETF.  

FAS:  The leveraged financial ETF has been a volatile and gut wrenching trade.  So far I am one for two, with a third trade in progress.  My current trade was entered in the mid 7 range and is currently at $9.  As I learned from the loss I took on my first FAS trade, early profits are to be taken quickly, so I took partial profits at $8.90.  

The beauty of partial profits is it keeps you in a trade if there is a big move in the direction entered.  Of course it can limit gains, but I believe what is given up in gains is worth the profit it keeps in case the gains don't hold.  My favorite part of the trade is when I lock in that initial profit and the rest of the trade is "free".  

If not yet in the FAS trade, I would wait to enter on weakness, ideally as close to the bottom as possible.  An entry in the $7-8 range with an initial target between $10-12 and a stop at $6 would give us a good low risk trade.  

Aside on risk and picking bottoms or going against the trend:  

Whenever I propose a trade like this, I get e-mails (mostly from blog readers--subscribers understand my trading philosophy much better) telling me that it's tough to pick bottoms, I am gambling and stocks making lows can go lower.  I certainly am not gambling, and I know the stocks can go lower.  If anybody doesn't understand by now, my focus is on risk and probability.  If I can find a trade that risks only $1 to make $2.5-5, I am going to take it regardless of other market variables.  I don't mind taking small losses where risk is easily defined, especially if technicals are extremely oversold (creating higher probability of a short term snap-back).

USO:  I sent out a trade alert on Friday letting you guys know I was entering USO since I had not mentioned it as a setup in the report.  Amazingly, it jumped just a little while after the alert.  This is another low risk setup, or was a low risk setup.  The move on Friday has increased risk if entered at the current level.  Stochastics are also nearing overbought levels.  If looking to enter, hope for a pullback as close to support as possible.  The target is $35-36, with a stop under the support range.   

XLB:  The materials sector is showing a good accumulation pattern, as volume has been positive since the November low.  The uptrend in the OBV indicator confirms what our eyes see in the chart.  An entry close to $21, with a stop at $20 and target of $24 offers good risk.  I usually post leveraged ETFs, but did not here since price is under the 50 day moving average (lowering probability of trade).  Those wanting increased leverage, use UYM.

XLV:  Healthcare shows a strong price pattern.  Pattern buffs will notice the inverse head and shoulders pattern that is forming.  Classic entry requires a breakout of the resistance line drawn in the chart.  I prefer early entries, and find entry here with a stop below the recent price range (stop at $25), provides a low risk trade.  I again did not post the leveraged ETF since this would be considered an "early" trade.  RXL provides increased leverage.

  

GLD:  Gold has been the easiest trade imaginable for those who trade extremes.  The last 11 times price has been either extremely oversold or overbought, according to the stochastic indicator, price reversed.  Not only does price reverse, but most of the trades provided big gains for those trading the extreme.  

We have now reached extreme levels again.  I will look to short on strength (90-91) with a stop above the October highs (93) and target $84-86.  While I use GLD as my guide, I will useDZZ or DGZ.

EWZ:  A number of counties, including Brazil, show more relative strength than the U.S. market.  EWZ looks good on a pullback, with a stop under the recent trading range and target around $40.

3.  Individual Stocks Focus List:

My focus this week is on the 7 sector ETFs (and ETNs) listed.  While these 7 charts will likely be my primary trading vehicles, I am still looking at some individual stocks.  

I have already gone over all of the focus list stocks via videos last week.  The analysis still applies.

MASI (short), HOC, RIMM, SSYS, SHLD, VAL, SIGM, CSTR, NOC, SGR, SVU, SVU, ELS, TTES, SLV, STR, USD, SU, PNRA (short), CBRL (short), ACI, CBI, FSLR, X, GFA, IIVI, PKG, GNK, WGOV, PLD, MEE, HP, CGRP, KALU, SID, IDCC, SIGM

New Additions:

BRCM, GOOG and QCOM

All three stocks show similar patterns.  On the BRCM chart, we see a positive divergence in OBV and RSI.  Price is holding above the moving average and volume shows accumulation.  I like all three on pullbacks to support.

4.  Current Positions:

Long USO, FAS, SHLD, TTES, STR

Position Update

For those asking for updates of my current positions, here is last night's Trade Report. I did not make any trades today.

http://docs.google.com/View?docid=d5z8q8w_674fcf7x6fj

Monday's Game Plan and Free Trade Report

I am offering today's Trade Report, which features my plan for Monday and the coming week, free to blog readers today. Enjoy!

January 5, 2008

Market Notes

The market is overbought. I'll get back to that, but first let's take a look at the overall picture. The market (via SPY-SSO) is putting in a healthy looking bottom pattern. RSI has broke out over the middle area. Price is putting in a constructive looking price pattern. Depending on how you view it, an argument can be made for a reverse head and shoulders or a bottoming cup and handle. Price has a broke out over the 50 day moving average. Last and probably most important, the volume pattern is strong, which signals underlying accumulation. Underlying accumulation is an important trait when bottoms are put in.

Note that this "bottom" is not a long or intermediate term prediction. However, it does signal a good probability we will see, at the least, a good bear market rally. I don't mean the 3 day variety we just got, but the type that could last a few months.

Short term, the market is overbought. For my trading style, it is not a good time to buy. Stochastics have reached overbought conditions (see chart), and the T2108 indicator has reached extreme levels, currently at 83.

The Trading Plan

The plan right now is to enter short term short positions to take advantage of the overbought conditions. Once overbought conditions are worked off, I will get ready to enter long in focus list stocks that pullback to support on low volume.

I will only enter shorts on strength. If we get good strength Monday or Tuesday, I'll enter positions listed in the focus list. Note that I already took a small position in FAZ on Friday (see intraday alert from Friday and the blog (www.themarketspeculator.blogspot.com).

Focus List

All longs are overbought and require pullbacks to support. Note that strong volume patterns and overbought stochastics on all stocks. Aggressive types can try taking quick shorts on some of these. This requires entry on price strength. A tight stop must be used.

JBLU, CKH, USM, USD, SUN, VMI, SGR, X, STR, DE, FSLR, ACI, TXI

Stocks from last week's focus list:

BKE, TBSI, IOC, GDX, GG, BG, DBA, CPA, ACM, MOS, SLV, SLW, PAAS, AIPC, AET, DRYS, SUN, URE, LVS, JOYG

Shorts: AXYS, CSX

Today's Game Plan

Here is the video podcast from last night's report. I'm still working out the kinks and video quality is not as good as I'd like. However, audio is fine and it gives a detailed analysis of my game plan for the coming days.

Any comments or feedback on the video would be greatly appreciated.

Focus List Stocks Nearing Entry Points and Free Trade Report

Many stocks from my focus list are nearing entry points. Below is Sunday night's Trade Report. While it's a day old, all the stocks on the focus list are starting to setup.

http://docs.google.com/Doc?docid=d5z8q8w_527r2m4qvfr&hl=en

December 15, 2008 

Market Notes:

There are many positive signs for the market, but it's still tough to find a good entry.  Positives include a strong volume pattern underlying positive price action.  This is a sign of accumulation by the "elephants" or big money.  Price shows a bottoming formation and is making higher lows and highs.

The problem for entry is that stochastics, while not extremely overbought, are still above 50.  A better entry would require more of a pullback.  

Those looking to enter still have a low risk setup.  Entry on weakness tomorrow, with a stop just under Friday's low, provides a 3:1 reward to risk ratio if using the recent high as a target.  Note that because stochastics are above 50, I don't consider this a high probability trade.  Still, the good risk ratio makes it a justifiable trade.

Focus List:

I am finding a lot of setups with positive underlying volume.  This is another factor that leads me to think the market is setting up for a rally.  

New Additions:

WW, ESS, MCK, GEF, ESL, CNQR, LRCX, MAN, EXP, AMZN, SBS, UYG, USD, MDC

Focus List:  Buy Dips

Here are stocks from the focus list that can be bought on low volume dips to support.

BHP, TXI, STR, CX, TXI, CLF, X, FWLT, VMI, SGR

Friday's Trades:

TXI:  See blogpost (http://themarketspeculator.blogspot.com/2008/12/trade-txi.html)

STR:  I bought 200 shares at $30.06, after the stock recaptured the 50 day ma.  

I talked about this strategy a few weeks ago.  Stocks with positive volume and price patterns that recapture the 50 ma quickly after breaking down tend to resume the trend.  If have not  done any formal research on this, but I have a high win rate with these types of trades. Thus, whenever a stock on my watchlist with a strong pattern breaks down below an moving average, I watch it for a remount entry.