DOW 26,000

1/17/18

Overall Market-

After a short pull back at market open buyers stepped in and off to the races we went, with the Dow Industrials back above 26,000 following earnings reports from several companies in the finance sector, as well as industrial production and capacity utilization data.

There’s a major deadline approaching in Washington, D.C. later this week, and Height Securities said Congress is likely prepared to do what many would argue it does best — nothing.

Several fiscally conservative Republicans plan to vote against the current Republican spending bill, likely leaving its fate in the hands of Democrats.

“Republicans have a 51-49 vote margin [in the Senate] and will need numerous Democrats to break ranks to pass a spending bill,” Height said.

So let us tally up the score... Government shutdown 50/50 odds, North Korea and the U.S back in a war of subtle threats, Russia accused of helping North Korea evade sanctions. AND FRESH ALL-TIME HIGHS?!?!?!

Something here is just not adding up here, the market is beyond irrational at this point. In my humble opinion, this is a dangerous sign that euphoria has reached a level bordering on idiocy. If nothing else we are in a period of complacency that will only be broken when many are once again thought to give the market the respect it is well deserved of.

I remain a cautious bull on this runaway freight train. Given an opportunity, I would not hesitate to short the market on material news.

 

VIX (Volatility) volatility is creeping back in the market even as prices rise. This is typically a sign that "smart money" is making a massive hedge on near-term uncertainty. It would be prudent for everyone to keep an eye on this indicator. While not a dead give away to a change in the status quo, it is a useful tool to glimpse if institutional money is betting on the markets chance to make an erratic move. 

NVDA (Nvidia corp) (No change, I am probably wrong on my thesis here but I just can not go against what I feel on this one. Until price action proves me wrong, I will stay out of this chop) My personal opinion on the semiconductor space remains unchanged. This chart is very choppy and is not clean to trade. Going out on a limb here and calling a top on this chart. Not going to short as there are no tradable signals but I will watch for weakness and a smart point to enter. I may end up a fool here but I can not justify the price/value here.

AMD (Advanced Micro Devices) (No change, I am probably wrong on my thesis here but I just can not go against what I feel on this one. Until price action proves me wrong, I will stay out of this chop) Perhaps I am playing the fool here as well but I am bearish on this price action. The weekly chart shows a better picture for long-term action. $10 support is major on this chart, should we get under that level shorts will be in full control. Just watching for now.

SOXX (Semiconductor ETF long) (Sector breaking to new all-time highs $185.04, not sure if this is legitimate or just following the market. This sector is dangerously overextended. 200 day EMA is all the way at down $114.) bearish doji on the weekly chart. Price in this sector continues to stall and confirm resistance at $180+- level.

 

FCX (Freeport) (no change) Price stalling at $20 level here, a bearish cross on MACD, RSI crossover at overbought levels. Based on current ATR levels a pullback to the $20dEMA $18.58, may well be in the cards. Conversely should price break over the $20 level with strong momentum we may be looking at one final leg of this incredible move. Overall price action here is well overextended at the least we desperately need some consolidation to build a new base.

CHK  (Chesapeake) (Update 1/17/18 - looking to short on this weakness, price structure showing potential short targets $3.81-$3.41, will be watching tomorrows price action for entry) (update 1/15/18 - while I remain bearish on this name, conditions in the sector are too strong to short. Technicals have a potential for a strong bounce, the weekly chart shows at the very least some consolidation after a long downtrend. The 50 period EMA on the weekly chart will be a clue as to long-term price action) I am bearish on this name from a fundamental long-term outlook. Energy space is just too strong to short. No signals have been generated to short this. However, there is a potential for a breakout of the current down channel we are trading in above price $4.17 with volume could be a signal for a technical squeeze to the 200dEMA which currently sits at $4.47. Follow volume and price action on this one, no safe way to predict price action at current levels.

XLE (SPDR Sector energy) and we are off to the races! The downtrend was broken with conviction, price well over $75 spot now. Expect this sector to continue with oil, copper, gold, silver and the overall market. Tailwind is in this sector. Remember to let your winners run!

MRO (Marathon Oil) (Update 1/17/18 bulls in full control, congratulations to any longs here.) weekly 200 period EMA $18.98 nearly tested! Weekly chart threatening to break out above the current channel. Squeeze may be on the table here. Watch for volume and price action over $19.00 for hints to next move.

SLB (Schlumberger LTD) (Update 1/15/18 ALL TARGETS REACHED! "trim and trail here" meaning trim position and trailing stop remaining shares. Set and forget this one. let it run.) (update 1/10/18 - continued strength, no reason to exit, the target remains intact.) I am long on this name with a target on the weekly chart 200 period EMA $76.53

Natural Gas (FEB 18 contract): New high and price stalling. I am bearish on price at these levels. We have had an incredible move off lows, momentum carrying this high, Risk/reward in favor of short at these levels. Looking for a pull back to the current uptrend and test of support. I would like to see this pull back to 3.11 or a retest of 3.00 spot. Inventory report tomorrow, price action here will be volitial. Swing alert on DGAZ @ $21.55

SNAP (snapchat) NO CHANGE - (Update 1/10/18 - need $14 level to become resistance for a move lower, short is still active here.) Alerted a short on SNAP during Friday's session. Stop is a bit tight on this one. Looking to test lows in the long term, $13.00 in the near term.

Trend Watch

  • $IMGN NO CHANGE, let it run on final shares. (update 1/10/18 - major winner here, weekly now sitting at 200EMA, a potential for breakout. swing for subscribers still intact.)(Update 1/7/18 - 3 red candles on the daily, tomorrow will be a critical day for price action. Need a reversal bar or doji for strength.)(Update 1/3/18 - After nearly a month in this position we are finally seeing price action with great strength again, I believe in a target of $8.50 here)(Update 12/21/17 Swing working well, trimmed size on 10% gain. stop adjusted to break even.) (Update 12/13/17 alerted swing to subscribers 12/12/17 at $6.00, stop $5.70, technicals have room to run here, volume and potential squeeze on deck.)(update 12/10/17 most indicators here are bullish, RSI cross midline, MACD strong, patterns confirming. Be on watch for swing alert on this name.)Looking to add above $6.00 for next leg.
  • QBAK (update 1/17/18 - price testing 50dEMA, will sell if closes under this moving average.) Holding 200 shares at $7.40 here, trend continues. Risk is $1.00 +-.
  • $ONCS (Update 1/17/18 - price continues to consolidate above to 50dEMA, like the potential here, on close watch) price consolidating above the 13dEMA, breakout potential remains!
  • JP - (Update 1/17/18 watching for this to pull back to the 50dEMA for a buying oppertunity, we are currently sitting at the 13dEMA, it may well continue higher but to much risk for me at these levels.) (Update 1/15/18 - ATR is getting very high here currrently $1.61, risk is upwards of $3+ on any swings based on 2x ATR, there is potential for day traders here, use pivot prices for entrys/exits.)(Update 1/10/18 - Strength remains in this name, trend is grinding well. Be aware for sudden moves in either direction on this name.)(update 1/7/18 Price testing critical FIB level 38.2% $20.73, this could be the end of the bounce here, watch close for a breakdown or breakout from here.) (update 1/3/18 - breakout on volume and a strong bullish daily candle, on watch for continuation. Strong base formed at this level a rally to highs is possible.) watching $18.20 for support to hold. Liking the technical and possibility for a rally.
  • VRX - (update 1/10/18 - $24 level showing resistance, watch price action from here, we may need a pull back before a move higher.) (update 1/7/18 price up nearly 6 points from first mention on blog, strength remains, trend is beginning to show signs of exhaustion, price action my get choppy from here.)(update 1/3/18 - held 13dEMA perfectly, incredible strength in the current trend. I may not get my pull back on this one. Will watch for a set up to new highs.) No position here, will look to buy on support around $18 level.

Robinhood Challenge: KILLED THE RCON TRADE! great trade, sold too soon but 133% gain, not going to worry about leaving money on the table. Currently 37 shares of DGAZ @ $21.55

 

Low float watchlist plays

  • TNDM (Update 1/10/18 - sold 1/2 position $3.15, stop breakeven on remaing shares. great trade here, now holding 3k shares.)(update 1/3/18 - A great recovery here, I was fully expecting to be stopped out for a loss here, price action continues to show sign of a run over $3.00, will let price action play out.)Still holding 6k shares here, may get stopped out for loss in the next coming days, will let trade continue to play out.
  • EKSO (update 1/10/18 - consolidation continues, on watch for entry long.) (update 1/7/18 - price holding at key level, potential consolidation and new base here. No position, ,only watching.) (update 1/3/18 - pin bar formed on daily, potential for reversal, volume was higher and selling pressure consumed by buyers.) price riding the 13dEMA here, techincals are showing short signals. Last level for entry on this is $1.89. watching for potential to retrace previous move.

 

BITCOIN/CRYPTO

"fortunes" are being destroyed as fast as they were created here. use caution with anything bitcoin right now. Price action is bearish in recent trading. Yes, this could aggressively recover but everyone here his discounting its meteoric rise. Price correction on this can still go well under 10k.

 

  • GROW: 
  • TEUM:
  • SRAX:
  • RIOT:
  • MARA:
  • DPW:
  • XNET:

Fire watchlist for market day 1/18/18

  • ITUS
  • DELT
  • WPCS
  • ATOS
  • LEDS

Low Float/Small Cap momentum-

Momentum is still HOT just coming in concentrated bursts. ORPN had a massive intraday move of over 100% only to close the day up less than 2%. This is telling for most momo moves. Lock them profits and move on. Grinders are not playing out.

Protect your gains during this period of explosive up and down moves. Small wins stack up, do your best to not let a winning trade go red, these are moving very fast. Do not worry about leaving money on the table.


Momentum disclaimer:
Use caution when trading these low float names, they can crash even faster then they rise. Lock profits and do not look back, never play the "what if" game on these names. You can be up or down several hundred or THOUSANDS of dollars in minutes and in the case of a T12 material halt, you could be in for massive pain or worse be trapped in a position for days or weeks until material evidence is sufficient to remove halt.
 

Closing Notes:

I will most likely be slowing my trading between now and government shutdown news. I see no reason to expose myself to pre news risk. Should a shutdown occur there will be plenty of volatility injected into the market for opportunity.

We are all in the market for gains but more important than gains is capital preservation. Some may call me too conservative, I believe in compounding as much as I believe in oxygen.

Albert Einstein - Compound interest.

Compound interest is the eighth wonder of the world. He who understands it, earns it ... he who doesn't ... pays it. Compound interest is the most powerful force in the universe.

Stay hungry and humble team, let's go!

Disclaimer: We are not responsible for losses for any reason. We are just an investing club here, seek financial advise from a professional before acting on any of this information. This information is strictly my opinion and what I am seeing in the market. The information above is not a trade recommendation to buy or sell. I am not a licensed broker, dealer or finical adviser. Trading comes with considerable risk and may not be for everyone. Past performance is not indicative of future performance. Never trade with money you can not lose and paper trade to prove profitability before using real money.