"So Sick of Complacence Now"

"Know thy Enemy" by Rage Against the Machine.
I've got no patience now. So sick of complacence now.

2.50 Feb SOL Calls @ 2.55

I like that burst of volume just a few days ago. As long as SOL can hold above its 20 day EMA, I'm happy. I may have gotten in a little early. Looks like it may pull all the way back to 4.21, its 20day EMA. Still love the price/volume action.

PS: Got out of my COST Puts @ .60 for a loss.

NYSE Bullish Percent Index

At least since '00, there hasn't been such an extreme and direct rise in the $BPNYA. Moving from below 30% to above 30% is considered a bullish signal. Going from above 70% to below 70% is seen as a bearish signal. I don't know exactly how to read the signal at the moment. But from the way I understand it to work, I think there are two good interpretations, that might be useful when combined with other indicators:

1) The market was so oversold that everything is registering bullish signals. Because of this, it is the time to buy, buy, buy.

2) The market is being irrational. This many bullish signals cannot be supported given the current economic environment. The BPNYA index is due for a pullback.

The second is more along my line of thinking. Check out the Chart Addict's newest post. He points out a rising wedge, a bearish signal. Actually, most of the site's I read and follow are currently bearish and, at most, considering a bear market rally before bearishness resumes.

I agree. But I am wondering if the government/media/someone will find a way to present the unemployment numbers on Friday as better than expected and representing a "bottom." In other words, I'm watching my back.

PS: Been doing a lot of digging and twittering. Working up my accounts and actually making some money on twitter (a pittance, but that's to be exptected). I am slowly edging myself away from those time sinks...

200th Post

I updated the site a bit for its 200th post birthday. The layout is definitely improving ever since I embraced the ideation of sexing things up.

What I really wanted to say was that I appreciate everyone's support, all the comments I have received, the suggestions, the tips, all of your sites, the visits to my sponsors, the camaraderie and so much more. I can't believe I have come this far. For all of you thinking about making your own blog: it isn't easy--but, it is worth it.

Here's to a good 2009 and another 200 posts.

You Think Housing is Bad Now? Just wait...

- "The problem now is that the insanity didn't end with the sub-primes...there were other exotic loans: alt-A's and option ARMs."
- "The teaser rates will go up. A mortgage payment of $800 a month could easily jump to $1500."
- "70% of these option ARMs will default."
- "We're looking at about 3 to 4 to 5 years."

(h/t Chicken Smith)

Some PnF Ideas

I thought it might be beneficial to show those interested one of my methods for finding playable stocks. This method involves going to Stock Charts' Stock Scan (link also in the sidebar under 'Important Technicals') and scrolling to the bottom, in the Point and Figure section. It doesn't really matter which filter you choose. Make sure you're shorting bearish stocks and buying bullish stocks, though. In this instance, I chose 'Descending Tripple Bottom Breakdowns.' It'll give you some stocks that show this pattern, and I chose a few that had a price over $10. You can go with the penny stocks, if you like, just be aware of their risk, and the fact that you may not be able to short something under $5 if you do not have sufficient capital.

Grab a few of those stock tickers, put them into the Candlestick Chart form. Add some useful indicators like RSI, MACD, Full Stochastics, 20/50/200 EMA, etc. Then do a comparison between the PnF and Candlestick charts. I've done most of the work directly on the charts below. My favorite out of the three is probably UTI. But I would be careful with any of them, as the market is in bear market rally mode. All three definitely look good for a short on overall weak market days.


Use caution. Take responsibility for yourself. Remember risk management is number one!

PS: Downloaded Think of Swim's software to do some paper trading practice. Looks solid. Thinking about posting some results as I progress.

Tres Charts

Look at the MACD slowly edging towards a positive divergence on the SPY's weekly. Signals an increasingly bullish outlook.