those arn't buyers, those are day traders getting out.
Monday, December 22, 2008
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21 comments:
Good call. I was one of them. Covered shorts at 3pm and got some TNA (triple bull) into the close since the market was so oversold. Still was down a little on the day.
14:30 and 15:30 have been good exits for weeks.
Am I not understanding T.Lo's spreadsheet?
The sell below connotes to me a "buy" with a sell stop. Her list is full of longs, yet the technicals seem bearish to me.
I know these are just high volume stocks with volatility, but it seems weird to me.
Take PAYX as an example. Close at 25.64 and her sell-stop is 23.60. The chart has is a bear flag with a declining 50 and 200-day MA.
The same could be said of most of the ETF's as well. I'll pose this as a question to her, too.
They are ranked by relative performance with the index that they are on, tech is mostly on the naszdaq, most the banks on the spx etc.
The stocks on the top are the ones outperforming the market the most.
The ones on the bottom are underperformed the market the most.
On the very top and the very bottom, if you were a quant and you wanted to put them into a Sentiment cycle, the ones on the top are probably at the end of the euphoria stage(good short), and the ones at the bottom are probably in the Panic or despair stage(tradable longs)
All the stops are technical, based on horizontal support and resistance( If it's a buy and it's close to the stop, and underperformed, it may be a buy for a nice swing trade).
for the most part in the middle it's a good list.
But yes that list will be "All Buy" when we are at the top. and "All Sell" when we are at the bottom.
It's useful when you are trying to find what is underperforming or outperforming the market, and what different sectors are doing.
Like i've said "It's purely technical".
but the model is to mix technical with the sentiment model. and that is how you make money.
Most screens are made using a very similar model(I think), to the technical one, so the secret is to know that that technical model is the one that everybody is playing.
I had a regional bank that didn't make it to that buy stop in this upturn, and I dumped all of my regionals based on that, because if they couldn't outperform in through the euphoria stage, I figured in the next downturn, they were going to be dogs....
and they were...
The things in the screen are "Technical buys or sells"... but you have to look at what part of the sentiment cycle you think we may be in.
Thanks, that helps.
I knew the performance is relative to the respective exchange, Naz or NYSE, but i wasn't sure what the sell below was about.
The stocks near the top of the list have more volatility and are either outperforming or "under"performing the exchange, depending on whether there is a sell-below or buy-above, right?
Assuming one feels we are in a bear market, then one would look for short opportunities among the "buy-above" stocks as possible shorts. Right?
The ETF's seem harder to figure since she often has short indexes among the "shorts."
Looking over the list as a whole can give some sentiment reading I guess, but I have to determine the stage of the sentiment cycle myself. All buys means we're near a sentiment top and vice versa.
Your explanation makes sense. Thanks.
You said:
"The stocks near the top of the list have more volatility and are either outperforming or "under"performing the exchange, depending on whether there is a sell-below or buy-above, right?"
When we hit the top of the sentiment cycle you what to short what has been strongest, Materials, tech.
At the bottom of the cycle, you want to go after the stuff that is the Most beaten down.
Because as a trader you want to make the shortcovering even worse for the shorts, and make those that were sucked into the "Bubble" suffer the most pain.
Not to add asshole to injury, but when gold was all euphoric and I sold what I have, I actually shorted it, because all the Hyperinflation/ gold bugs... needed it taken to them. Now after the "froth came off" I then took profits, Cause I'm not sure... if gold can break 870 we will be off to the races.... and maybe they are right, But All I'm trying to do is Fade the euphoria. and that is what to make money off.
You and I both know that when ever there is euphoria, there will be a correction.... and that is easy money.
So... The stops, as Teresa said, as I can see are just when the stock does a "Base move", you know when a stock moves up, then corrects, then moves up again to new highs, it's below that correction that the new stop is placed.
Hey, make sure you say nice stuff to T.
Like writer her a nice note, seems like she gets frustrated that people don't "Get it", and she is roughly a one woman show And her service is awfully cheap, and just reading her blog is worth the money.
pull some names off the list, i'll be happy to fight wiyh you over them
How 'bout GIS as a short candidate: lagging the index and the index looking shabby... the ugliest girl on the Titanic.
The way I would evaluate the technical trade set up is to watch it and any rally toward the 50-minute MA (currently at 58.51) would be a potential short sale. Alternatively, a downsloping resistance can be drawn as an entry point for a short position (currently at 61). Currently, the stock seems near a decent entry, ie the 50 MA.
{BTW, T.Lo mentioned GIS as a Cramer stock}:
http://invivoanalytics.com/2008/12/19/gis-general-mills-inc/
Another short to look at is AEP.
I guess the initial task is to look at weak and strong sectors-- as you do daily-- and then find stocks in the various sectors to go long or short.
One question: do you have both long and short positions going at the same time?
Yes, I'll play both sides.
I'm looking for an ABC correction in here, want to make something on the B wave....
But...
Teresa did suggest that we may see a bear trap off of yesterday.
I'd look for GIS to test that October low, then bounce into some resistance. After it breaks that it will start working into some panic.... seems like it's still in some warning stages... but always possible that it is in a "Buy the dip stage"..
but I'd think that people are moving out of the consumer safety stuff.
I still have some proshares that have gone Ex-dividend this morning. I'm starting to not want to play them.. I was in a bunch of them last year at this time too.
What a pain in the ass.
B wave being upsloping?
Not sure which wave 3 we're looking at.
Seems like a (small) bear trap cooking, with market down a few days in a row that's not too odd.
But bias is still down, and I would be inclined to sell into rallies.
I'm just talking about some sideways moves.
Have you noticed SDS down 12% premarket!! $75.
I know those short etf's are priced oddly, but that seems really out of whack
Duh. It went exdivvy, and you just told me.
[bangs head on desk.]
they went Ex-dividend, so they take a chunk of them and distribute that chunk as a dividend.
so the price goes down by a few bucks. then they give it to you on the 30th...
Like I said it's a pain in the ass.
Doesn't help the fact that now I don't know where I am with them, and that I have to use the index etf to figure out where I am... and that I don't have that money to trade with for 6 business days, or whatever..
I remember this nightmare from last year....or too bad I didn't remember it in advance...
I want to see us trade those early December levels.
Yeah, going ex-divvy makes all the graphs useless.
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