New Trade - CAG

Deuteronomy 28:12 "The LORD will open the heavens, the storehouse of his bounty, to send rain on your land in the season and to bless all the work of your hands."

The final edge of today:

Check out the chart for CAG:

This is a simple pullback trade. A close above the high of the low day. You can see there was a substantial break of prior resistance, which is now support and my target is close above - new resistance.

My stop is placed just below the most recent low. This should be a quick trade as well.

I bought a couple of the June 24 Calls for $0.60 each.

New Trade - MXIM

Deuteronomy 28:11 "The LORD will grant you abundant prosperity"

Another edge

Here's the chart of MXIM:

Another similar set up to many others out there in the market right now. After a decent pullback about 1.5 months ago, this stock has been uptrending. This trade is based on the 2 consecutive closes above a recent high. Although this stock has been going up strongly for the past 4 days, I still think it could continue on for another few days before hitting the target (overhead resistance).

However, if we get some sideways action, or even a slight pullback, then I wouldn't be surprised either. I've got plenty of time in the option purchased for this one.

I bought the August 28 Call for $1.25. You can see the stop placed below the most recent low.

New Trade - SCHW

Jeremiah 29:11 "For I know the plans I have for you," declares the LORD, "plans to prosper you and not to harm you, plans to give you hope and a future."

Finally, we have an edge in the market!

Here's the chart of SCHW:

This stock has recently been trading bullish after a good pullback about 1.5 months ago. Although this doesn't EXACTLY match my entry rules, the fact that the size of that buying tail, a bump in volume, and the MACD lines going up, all convinced me to get in at this time. The very next day it could easily hit it's target.

I'm not looking to make a ton off this trade, just a quick profit within a couple of days.

I bought the June 18 Calls for $1.00 and looking to hit the immediate overhead resistance as my target. My stop is placed just below the last low.

TOS - target hit, profits taken

GLORY TO GOD - ANOTHER WINNER!

Took profits today in TOS after it hit my target.

Here's the target:

You can see that the upper tail hit my target today (or got really really really close - think of targets like horse shoes , just get close). So, I took profits.

One thing to learn on this trade. I DID NOT have on a sell stop. A sell stop is used when you can't, or don't want to, watch the charts all day and get out manually when your target is hit. You can basically set up an order with your broker to sell your option once the stock hits a certain price, then it will automatically do this once it's hit.

I usually don't use these because I can eek out a few more dollars by getting out manually. However, I work now and today was one of those instances where the target was hit during the middle of the day and pulled back by the end of the day (when I usually trade).

So, I could have made more profit today and will most likely start using sell stops when I have a close target, like in this trade. Remember - always keep improving your trading.

Anyways, I originally bought this option for $2.65 and sold it today for $3.05, giving me a $0.40 profit, 15% ROI, in 4 trading days.

Not too shabby, could have been better using a sell stop. But, all is well and it was a profitable trade.

Time to find the next one...

MDR - stopped out - loss

Win some lose some. That's the way it goes. Gotta expect losses or you're just fooling yourself.

Here's the chart:

I COULD HAVE gotten out yesterday, however, seeing that buyer's tail along with some other strength in the overall markets, I decided to stay in for another day to see what would happen. We basically had another down day in the same zone. So, I did exactly what I should have today - took my loss.

This was a good trade. Yes, I lost money, but I followed my plan and took my stop. I could really care less where the stock goes from here. All I know is that I had 2 consecutive closes below the low of the pullback day (blue circle) and that is my time to take my losses and get out.

I originally bought this option for $1.90 and sold it today for $1.18 for a $0.72 loss, (37%) ROI in 4 trading days.

Just taking my lumps, no biggie - guess what I do now??

I LOOK FOR MY NEXT ENTRY

New Trade - TSO

Isaiah 40:4 “Every valley shall be raised up, every mountain and hill made low; the rough ground shall become level, the rugged places a plain.”

You've already seen the markets from the last post, so let's look at the chart for this new trade - TSO:

LOVE this chart as well. Higher lows (no blue circles this time). Price staying above the 50 day moving average, a close above the high of the low day (albeit a few days later), stochs screaming higher, MACD's looking like they are ready to roll up, and combined with the overall market action we have an edge.

I bought the August 27 Call for $2.65. The stop is just below the low of the low day. The target is simply the area of the most recent highs where the sellers pushed down the price (i.e. purple line).

Let's make this a quick profitable one as well...

It's Time...

Isaiah 45:2 "I will go before you and will level the mountains; I will break down gates of bronze and cut through bars of iron."

Time to get back into some trades, check out all 4 markets:

Looking at the charts above, starting in the upper left corner is the SPY. It just closed above the high of the low day and it closed above the 50 day moving average. I'm looking for this to continue from here up to it's recent high of 134 or it's prior, more significant high (green line).

Beside the SPY we have DIA, which actually broke it's more significant high (green line), and has bounced off it's 50 day moving average. Again, looking for this to get back up to it's most recent high of 124 ish.

Below DIA we have the IWM, which has been the overall leader in the recent month. It went a bit above it's more significant high (green line) and had a strong bounce off it's 50 day moving average as well. In addition, it (like the SPY and DIA) had a close above the high of the low day.

Last, in the bottom left corner, we've got the laggard - QQQ (nasdaq). It has been going sideways just under it's 50 day moving average. So, there's no signal for us to get bullish if we JUST rely on QQQ. However, since it's been such a laggard, we are going to rely on the other 3 markets to pull it up and go with a couple bullish trades.

We'll look at the first trade in this post - MDR. Here's the chart:

Sorry that this chart is marked up a bit, but I've had some trades in it over the past 6 months - it's a money maker! You can see from the chart we had a pullback and a close above the high of the low day. In addition check out the stochs - quite low and now looking like they are about to take off. The MACD's were low and looking like they are ready to go higher as well. Check out the higher lows in the blue circles. I also like the little uptick in volume and couple all of these factors with what the overall markets are doing and we have....

AN EDGE!!!!!!!

So, since there's an edge, it's time to trade. I bought an August 25 Call for $1.95. I'm only looking for it to go up to resistance above - the purple line - so this could be a very quick trade. If it drops for 2 consecutive closes below the low of the low day (i.e. yellow marked line), then I'll get out with a loss.

Time to get some profits again.

Be patient - signs have been confusing in this market

It's been too topsy-turvey for me to trade. We were going up, then got a pullback, then put in a lower high, then put in a lower low and I was then ready for bearish setups...

However, the market has not turned over to put in another lower high. This now makes me think about going bullish. The IWM and DIA have already broken their relative highs from approx 6 weeks ago and the chart above shows the SPY is close to breaking it's relative high - i.e. no more lower highs - i.e. not bearish. QQQQ's (i.e. technology) has been the real laggard.

I believe that we are looking more favorable for going back bullish now. But, the QQQQ's are simply too far down to wait for them to catch up, I could lose out on too many trades waiting for them. So, as long as the SPY, IWM and DIA are all looking bullish, then I'm good with that for entering new trades.

So, I'm now thinking that we have a slight pullback in the SPY, then, once the bulls come in and start driving the market back up, I'll jump back into trades.

The market may also just continue to either go sideways or keep inching up. If that becomes the case, then I'll wait for 2 consecutive closes above the SPY's relative high and then will look to enter bullish trades. I'll want confirmation from the other markets as well, along with a few other items I'll watch. A lot to understand, but things will get clear again.

So, the plan is to wait for now. Yes, waiting sucks, but it's better than losing. And, my past impatience has cost me THOUSANDS. So, I wait and let the confusion give way to an edge...