Friday, February 26, 2010

Daily Stock Chart Check 2-26-10

Happy Friday everyone, Lets hope it is a profitable one for you. Looking at the Dow chart this morning you can see we had an up and down day yesterday or should I say down and up day,as the Dow broke below the 13 day and 21 day exponential moving averages. THE GOOD NEWS is that it closed above them as the market had somewhat of a rally at days end. The chart is showing me that we should see a rebound today and see it move toward the 10500 mark. If it breaks below the 10185 mark we could be in for a new downtrend in the market. LOOKING FOR SOME RESILIANCE HERE!!

As for my active trade it did pretty well in spite of the market being down. It eeked out a .03 gain. Whenever a stock can show a gain in the midst of a broader market pull back, that is a good sign. Take a look at the stock chart here. You will see it has bounced off its support levels and the 13 day is currently crossing over the 21 day exponential moving avg.(ema) you can also see the consolidation channel, so what would be a very strong sign that the stock is gaining momentum would be to see it break out of that consolidation, somewhere above the 13.48 mark.

So that is what I will be looking for today. Please let me know how your stock trades are going. I love to talk strategy with fellow chartists.
Have a great weekend and Happy Stock Charting!!!!

Thursday, February 25, 2010

Daily Stock Chart Check 2-25-10

Good Morning,
So far this week the market has shown a great deal of predictability(We know all that can change in a hurry). Before the open lets take a look at the chart for the Dow Jones. We are concentrating on the 13 day and the 21 day exponential moving average. Look how the Dow seperated last week from these averages, and if you have been following along with my recent blogs, I have mentioned that it will seperate but count on the return back to these averages as they do not (usually) stay seperated for a very long period of time, as was the case for the Dow here recently, as it moved back to its averages this week.

The Dow now is sitting on top of the 13 day and 21 day ema, will it consolidate a bit more? or will it bounce of these averages today and continue its uptrend and head toward the resistance level of around 10500? I would wave a short term Red Flag if the Dow goes below its last 2 day low of 10267.

HCBK one of my active trades is showing some consolidation with the 13day ema crossing upward over the 21 day ema which is a bullish sign, I also am looking at this stock chart seeing it meet its support level of around 13.00 and yesterday bouncing off those levels in a positive direction. That is why I will stay with this trade and look for its momentum to carry it over the 13.47 mark.

Yesterday I exited IPG at 6.91 (Bought at 6.82) for a small gain. The reason that I exited was that the stock chart showed me that the 13 day ema was crossing over the 21 day ema in a downward direction alerting me that it looks like it will continue its downward trend and head back toward its support levels of around 6.30. As I said in a recent blog this chart has formed a classic head and shoulders formation. Hey no matter how small the gain, it is still a again and I will take it over a loss anytime.
Until tomorrow.....Happy Stock Charting!!!!

Wednesday, February 24, 2010

Daily Stock Chart Check 2-24-10

Good Morning, Things went pretty much as what the chart indicated yesterday the Dow did come back and hit its 13 day and 21 day ema. This is very normal, if you look at the Dow chart notice that it does not runaway from the averages for too long. It always comes back. This can serve as a exit strategy for you to take profits, sit on the sidelines until it comes back down and hits the 13 and 21 day ema. The key here is make sure that the Dow shows some consolidation here. You want to make sure that it is not going to continue downward toward its lower support level.
Looking the stock charts of my active trades, well they went pretty much as expected. IPG did go down and hit its 13 and 21 day ema. It is my strategy to let it bounce off the averages and let it continue its current upward trend.
As for HCBKs stock chart, it is also doing as I thought it would consolidating at the ema's and it is also down to its support levels, considering the market yesterday this stock performed well, and I am looking to see it start a new uptrend within the next day or two.
I hope all your stock trades are starting a new uptrend today, It would be great to hear how you are doing. Until tomorrow.......Happy Stock Charting!!

Tuesday, February 23, 2010

Daily Stock Chart Check

Good Morning, The Dow looks to be wanting to come back to its 13 day and 21 ema before it moves to its resistance level of 10,514. Dow futures are pointing slightly down to flat this morning but that could all change after the open.
IPG - One of my two active trades went up and hit its resistance level and now going back to meet its 13day and 21 day ema. I will wait for the bounce. Take a good look at this chart and you will see a classic head and shoulders formation forming(See the shoulder to the left and the head in the middle and the right shoulder is forming). It would be great to see it bust through resistance of 7.22 today!!

HCBK - As you can see from the chart it is bouncing off its support level looking for follow through today.
When you are looking at support and resistance levels you should see at least 3 points of where the stock bounced off of those levels, as you can see on this chart there are 5 good points where it bounced off and continue in a upward direction from its support levels. These are the type of stock charts that I look to trade because they show some predictability and trend.
Until tomorrow.......Happy Charting!

Monday, February 22, 2010

2-22-10 Daily Stock Chart Check

Good Morning, Lets see how the market will start out this snowy Monday morning(at least in Michigan)
Looks like the DJI will continue its upward momentum. I look for it to reach the 10,471 (I am looking at the resistance line in the stock chart above)before we see a possible retracement this differs a little from what I said last week, but after studying the chart over the weekend I do believe that it should continue its gains.
Looking at my active trades: IPG's chart formation is looking strong, nice upward momentum with the 13day ema crossing the 21 day ema. I will hold this trade for at least another day,currently showing decent profit from 6.82 where I bought in at.

HCBK has retracted down to its 13 and 21 day ema, I am still looking for a bounce back off these levels today. If it goes below the support level, I will exit the trade and cut my losses.
Until tomorrow .......Happy Charting!!!

Friday, February 19, 2010

Daily Stock Chart Check 2-19-10

Today I will be interesting as you can see the DJI Chart has gained momentum. Will the 13 day ema cross over the 21 day today and continue this momentum? I think it has a good chance. Although if we do have a up day today you can expect a early week pull back as it starts to distance itself from the averages. You have to play the averages. It takes alot of the risk out of your trades.
As for my active trades, I will be watching them all very closely today. HCBK - I got in at 13.27 currently it is at 13.37 and I am looking for it to bounce off the 13 day ema and continue its upward trend.
IPG if you remember I bought this at 6.82 and it is now at 7.09. I like how the13 day ema is crossing the 21 day ema. That is a good sign.

As for LEG the one I recommended (at the same time I bought IPG and HCBK) at 18.87 is doing great it is now trading at 19.59, nice 3 day move. If I were in this trade I would continue to hold as it is climbing and staying close to the ema. averages.
I hope you all have a great day and next time I will be talking about an exit tool that I do use occasionally. It is call the 50% retracement indicator. I will explain it in my next blog. Until then.....Happy Charting

Thursday, February 18, 2010

Daily Stock Chart Check

Looks like today there could be a mixed bag between the Dow and the Nasdaq according to the futures. Looks as though we may see a follow through in the Nasdaq from yesterdays session and the Dow looks like it could start out flat or trade slightly lower this morning. Both charts are showing upward momentum though as you can see from the charts. The Nasdaq chart is showing me that it will in the next day or two come back down to reach its moving avg. this is like clock work, it will not stay away from the 13day ema for too long. The dow chart looks very strong I would not be surprised to see a up day today.
Lets take a look a the opportunities that I mentioned from a couple of days ago.
HCBK- In at 13.27 current 13.24 I will start out with the loser as of now, but the chart is showing that it is still moving along the 21 day and 13 day ema. I will stay in this trade.
IPG- In at 6.82 current 6.98 this is more like it, I also like what the chart is telling me with this stock. I am looking for up day today, if it gets too far away from the avgs I may exit and take profit.
LEG - Remember this one, the one I did not buy but recommended two days ago, so I am going to take credit for it since that is all I can take. Recommended at 18.87 current 19.48!!! Looks as though this could continue its uptrend according to the stock chart. If it gets too far from the moving avgs. today I would be looking to take profits today or tomorrow. 1000 shares of this would have returned $610.00 in just 2 days. Not Bad.
Well until tomorrow.....Happy Charting

Wednesday, February 17, 2010

Evaluating Picks from 2-16-10

Today lets hope for a follow through from yesterday, dow futures are up modestly this morning. The chart for the dow shows some momentum as it trades above the 13 day ema. and the 21 day ema, as I said yesterday this is what I was looking for.
Charting my stock picks from yesterday they all triggered. Here was the results
HCBK - Order for 1000 shares triggered at 13.27 closed at 13.41
IPG - Order for 1000 shares triggered at 6.82 closed at 6.87 - I am watching this one closely as it gaped up and many times when a stock gaps up it will retrace its gap the next day or so.
LEG - Wouldn't you know I identified this stock in yesterdays blog but did not put in an order for it, as I went with the other 2(IPG and HCBK) and of course that was the best performing stock of the day, I said in yesterdays blog that I felt there was a good opportunity if LEG crossed 18.87 and it did it closed at 19.39!! Oh well you can't buy them all. I hope someone following this blog got in and made money yesterday charting this stock.
I will be watching the stock markets closely today watching for follow through and momentum. Until tomorrow..............Happy Charting

Tuesday, February 16, 2010

Buying Opportunities 2-16-10

This morning I looked at the overseas market and they are pointing to a higher open for our major indices. Hopefully we will start a new uptrend today, I am looking for the markets to get on top of the 13 day moving avg. Here are the possible buying opportunities I identified.
HCBK(above)- I have placed an order to buy 1000shares on a move above13.27, notice trading above 13 and 21day avg. looking for follow through.

LEG below)- Here the stock is bouncing off support levels, I believe it will move back toward the avgs. I would be watching very closely as it does reach the avgs. to see if it will bounce back but there is profit to be taken in between. I would be looking at a buy here above 18.87,but again keep an eye out as it reaches the avgs.

IPG(right) -Trading with upward momentum and above the 13day ema(exponential moving avg), it is bouncing off support levels and looking for a follow through above the 21 day ema today. I have put in an order to buy 1000shares when it moves above 6.82
Remember charting stocks is not an exact science. I look at it as more of an art. Follow these charts and see how I do.
I may be in these stocks for a day or 10 it all depends on what the stock charts tell me.
Until tomorrow.... Happy Charting

Monday, February 15, 2010

Stock Market for Beginners

Since the markets are closed today in observance of Presidents day, I thought I would give some tips of how to get into and get yourself prepared to trade.

1st thing I did was get a good book on charting,( you can google info) get definitions of different charting tools and how they are suppose to work, I will not recommend any one specific because they are many good books, what I would recommend is don't buy one that is selling their specific system. Get one that talks about all the different charting tools and the different chart formations, along with support and resistance information. This will give you a good idea of what the world of charting stocks is all about.

2nd thing , START CHARTING( is a very good site and its FREE) different stocks, apply some of the information that you researched, you will start to notice trends. Start out simple using moving averages(really that is all I use today) I do recommend the 13 day and 21 day exponential moving averages. Add some different tools and get use to the terminology. ALSO JOIN IN ON BLOGS LIKE THIS. It is a great way to talk and converse with everyday traders who will give you honest answers and share their experiences with you. Everyone can gain by doing this whether your a beginner or a more experienced trader. Remember you never quit learning!!

3rd Thing, Start to look at different discount brokerages. There are many good ones out there. I happen to like Scottrade it is only $7.00 per trade and it gives me the tools I am looking for, again do your own research on these. With most of them you can set up a practice trading account they will put play money in and you would trade with them as if it were real. This is a big help because it gets you use to how to place a trade correctly.

How Do I fund My Account When I have no Extra Money? This may be simpler than you think. Most discount brokers want somewhere around $500.00 to get started. You can start out by just sending them money when you have extra and use this time to practice while you are building up to meet their minimum amount to actually start trading. I started out with $2000.00 in my account. I got extra money from selling things I no longer used or wanted on ebay . You can have a garage sale( I used this method as well). See there are many ways to fund your account when you are ready to start trading REAL MONEY.

I hope you found this helpful, if you have any questions I would be happy to answer them, just send me a post. Until next time...

Happy Charting

Friday, February 12, 2010

Dow Trying To Gain Footing

Lets start with the bad news. The Dow is down again as I am writing this at around 3:10est. The good news is that it did not hit below the previous days low, looks like the market is trying to gain some footing here. What we need to watch is if it dips back below the 9976 mark it could show the bears are gaining strength. It is still flirting with the 13 day moving average. Need a break through next week so it is sitting on top of it before I will look at buying opportunities, but believe me I do believe there will be some buying oppotunities. I may look at some short term shorting opportunities over the weekend.
Happy Charting

Dow Jones going to fall Again?

After Reaching back to the 13 day moving average will the the Dow Fall Again? The S & P futures are show early morning weakness for the major indices. I am still staying on the sidelines!! Until these markets can at least get on top of the 13 day moving average I am not comfortable buying any stocks I need to see some follow through( I will post exactly the day I get in and start buying).

Take a look at the chart above look at the yellow arrows, there is a difference between the last time the market reached the 13 day moving avg. compared to current conditions. When it reached it the first time it was still showing downward momentum. The last few days it has shown upward momentum. Will it bounce off the 13 day moving avg. and continue downward or will it bust through and get on top of the 13 day moving average. I said yesterday was pivotal. Well today is just as pivotal. Continue studying the charts, It will tell you exactly what is going on. There is money to be made studying charts, again be patient and wait for the chart to let you know when the right time is to buy. Have a great weekend..........
Happy Charting

Thursday, February 11, 2010

The Dow Jones Industrial stock Chart -pivotal day

The Dow Jones Industrial chart shows yesterday although it did not make a new high, the good news it did not make a new low. Two days ago it hit its 13 day moving avg. Today could be pivotal!! will it continue its current lower trend or start to consolidate and move upward?

S & P futures ( by looking at this it gives you an idea of how overnight trading did and how the market may open today) shows that the market will open flat to lower. Lets hope their are some reports due out today that will put a positive spin on the market. No trade for me today, but keep watching your charts, there will be a buying opportunity around the corner.

Have a great day and Happy Charting!!

Wednesday, February 10, 2010

Stock Charting Specific

The broad markets (which is what I look at first before I study individual stocks) are trending downward. As you can see on this chart(above left) of the Dow Jones Industrial. It had a positive day yesterday and is now reaching back up to the 14 day moving average. Before I would think about buying stocks this chart needs to show some consolidation or the 13 day needs to start pointing up. So today I am staying on the sideline until the market shakes out .

While I am not in the market today I would like to show you a current chart of the S & P 500 (right) Market and how it has trend over the past few months and where there was plenty of opportunity to make some very good $$$$$. Look at the green arrows, here you can see that the market was trending down to the 21 day moving average and then would bounce back, it did this 4 times with the last arrow showing a top.
You ask how do you know where to get out or cover your position? There are a couple of signals that tell you the market is about ready to reverse, see where the last arrow is? once the stock price breaks below that arrow would be a good signal to get out. Another strong indicator is where the 13 day moving average crosses the 21 day moving average in a downward direction.
To me this is the simplest way of keeping track of the market. Just with these two exponential averages. I use to use others like Fibonacci, Williams % R, Bollinger band(I still use these once in a while) but really all that did was mess and confuse my charts. Learn to use these averages and again use patients and you should have success charting stocks. Let me know how your doing!!
Next time I will talk a little about the possibility of SHORTING STOCKS oooh noo!
Until next time HAPPY CHARTING

Wednesday, February 3, 2010

Not As Hard As They Want You To Believe

Charting stocks and making a good profit is not as hard as the pros want you to believe that it is. Yes there are some criteria involved that separate the good traders from the washed out traders but it is very possible for you to make good money from watching your own money instead of just handing it over to some investment advisor, don't get me wrong there are some very good advisers, all I am saying is that no one cares more about your money than...... you do.

Charting stocks or technical analysis of a company allows you to gauge a company's momentum or lack there of by looking at the trend of the stocks price through a certain period of time. It gives you a snapshot you could say of how that company's stock is performing and even the likely hood of if it will continue or not. This is where you profit. You can make a profit on the way up or you can profit if the stock is going down. No having to look at any ratios, studying the company's earnings and revenues or dissecting the year end books, because it is all baked in the chart, the story of how well or how poor the company is doing is right on the chart and reading it is easier than you think.

Once you understand the universal principles of charting you will be able to use them in any market whether it would be stocks, options, futures, or any market for that matter. You will be able to tell who is winning the bears or the bulls, for the chartists it really does not matter.

Going back to the criteria that makes a good trader..... here is my list:

1) You must be disciplined - do not let yourself get caught up in greed. A good trader stays calm, cool and collected. Manage your emotions and read what the chart is telling you and you will be profitable.

2) Patient,Patient,Patient - I cannot stress this enough. Don't feel that you have to be in the market all the time, don't feel like your missing an opportunity just because you are not in. Some of your best trades will be the ones you decided not to get into. Let the market come to you, do not chase it.

That's it! those are the two personal criteria you will need to be a successful trader.

There are some terms that you will want to get use to like resistance ( a certain price point that the stock repeatedly will go up to but not break through) and support ( a certain price point that a stock will repeatedly go down to but always seems to bounce back from).

When researching and studying different styles of charting stocks you will hear about chart patterns such as flags, pennants,channels,1-2-3 bottom and tops, head and shoulder, the list goes on and on.

You will also hear of charting tools that may help you decide when there is a good opportunity. Some of these are: Moving averages, Bollinger Bands, stochastics, Oscillators, RSI, Williams % R, MACD...again the list goes on. There have been many books sold on these(I have actually read many of them) individual methods. These can be very contradictory and hard to evaluate.

My rule is KISS, you know Keep It Simple Student, because anyone involved in studying the market always continues to be a student. HERE IS HOW I HAVE BEEN SUCCESSFUL. I use the 21 day and the 14 day exponential moving average on a high,low,open,close style bar chart.

I start out by applying them to the DOW, S & P 500 and the NASDAQ exchanges, this gives me a very good idea of which direction the major indices are moving.

I figure out what the trend is, then I study and analyze all the stocks in the S & P 500(I do this at night after the market has closed) that are in my price range and decide which chart is showing me the best opportunity. The reason I use these stocks are because they are high volume stocks which means that they are very actively bought and sold and for me that makes them a bit more predictable.

When I find the charts that are interesting to me I then check the news on them to make sure there wasn't any major news out on them after the market closed that could effect the price of that stock the next day.

I then put in an order to purchase that stock at a price higher than the previous days high, anywhere from 7 to 10 cents higher. Why you ask? because I want to know that the momentum is going to continue and that my study of the stock was, at least on the open correct.

Once my stock hits my predetermined price and is purchased I continually watch it on a daily basis making sure it is continuing up the 14 and or 21 day moving average, along with watching for any breaking news on my stock that could drastically change the price of the stock.

Now for maybe the most important part WHEN TO EXIT YOUR POSITION. Not only is it important to buy right it is also as or more important to know when to sell. There are a couple of ways to do this. When starting out and you just made a nice profit and are getting nervous, GET OUT!! TAKE YOUR PROFIT!! but do yourself a big favor, find out why it was a good trade, what are the things you did right, NEVER beat yourself up when you look at the stock the next day and it went up another 10%. You made a profit, be happy and look to the next opportunity.
What I do is look at the chart and news everyday and ask myself would I buy this stock today? If my answer is yes then I hold it, if my answer is no I put in my order to sell, I take the emotion out of it. It is that cut and dry for me. Like I said earlier KEEP THE EMOTION OUT OF THE TRADE.

When Charting Stocks I never look to get in at the very bottom and out at the very top, I like to take my profit out of the middle, it is less risky.

I love the art of technical trading. I work on polishing my craft everyday. I created this Blog to find others that feel the same way and to exchange ideas and to invite people that maybe have just started or are just curious of how this can work for them.

I painted this subject with a broad brush, so do some reading on the subject of technical analysis there is not a shortage of reading material out there believe me. Let me know your thoughts.
I will continue to post in more depth on the subjects of Charting Stocks and even let you know what I am trading and the results(doing this really helps me stay focused). Currently I am on the sidelines looking for my next opportunity. Let me know how you are doing.

I am currently what I would call a part time trader, I am 43 years old, have six children and I do have another job (Realtor) but my passion is trading. I have been studying the different aspects of trading for over 15 years. I have taken my share of lumps playing options and futures, I now totally concentrate on just the stock market, it is what suits me best and where I am most comfortable. Last year 2009 was my best, I made approximately 80% on my money, and its all about being DISCIPINED and PATIENT! and over the last 6years trading has added a nice supplement to my income. I do take money out of the market because it makes it more real. Nothing nicer than seeing a check come from your brokerage firm. I know...I know Warren Buffet never sells a stock, well if I had a plane to fly all over the world to check out businesses that I might be interested in buying then maybe I wouldn't sell either. The only thing I think I have in common with Warren Buffet is that we both love what we do.

I hope this has helped you in some way or at least peaked your interest, again stayed tuned and jump in and participate....I would love to hear from you.

By the way I always advise people who are just starting out to take a month or Ten and practice, there are many brokerage companies that will set up ficticious accounts for you to do dry runs and get a feel for the process without the risk. You will know when your ready for the real thing.

Until next time...When we will talk about specific entry and exit points and my most current position(s) in the market.......... Happy Charting!!