Good Day Traders,
I received several emails from members who were able to enter trades on the stock picks from last week and enjoyed the fruits of those trades! Highlighting strong stocks for Premium members in the “Potential Setup” section of the Trader’s Report continues to give members a focused list of potential winners each week.
Some modification I will be making going into this week on notifications and alerts:
1. Text Alerts followed by Email Alerts for both buy and sell notification. We have tried to tailor the alert system and only provide Text during Market hours on buy alerts. At the suggestion of several members both buy alerts and sell alerts will be sent by text and then followed by the email alert going forward.
2. Easier to understand template for orders. I attempt to provide both the reasoning behind the trades that ATTS is making along with the limits and conditions of the trade. I believe the new format will provide more clarity and simplicity.
3. Text Messages will either have the subject line of ATTS Alert or EWA Alert. Additionally, the email messages will have a subject of ATTS Alert or EWA Alert with the symbol of entity being traded.
4. I will slow down and have alerts proof read to reduce typos on symbols.
General Market Observation: The Markets are oversold and showing mixed price action. Currently weakness in the S&P and Nasdaq 100 is not showing up in the Russell. A higher bounce in both of these Indexes would seem to be in order but it may only be a move to past resistance leading to further weakness. Friday’s action showed the level where each Index found support. This now becomes a benchmark for planning trades on the Indexes this week. Will these identified levels withstand the next downside assault successfully this week?
SPX: Price rebounded from the 100 day moving average. If price can push back above the 2064 level and break through the 8 day then a surge to 2080 or higher may take place. The 2040 level provides support. Price finished right in the middle of Thursday’s candle. Often times the midsection of large candles provide either support or resistance depending on direction of price action.
NDX: The attached chart of the Nasdaq show that Friday’s price action took out Thursday’s low and then rebounded. The finishing pattern is a Bullish Harami which is a positive reversal signal. If this bullish signal fulfills then any advance will run into resistance at the falling 8 and 20 day moving averages.
The market could very well be moving into a sideways consolidation like it did earlier this year. If a sideways scenario emerges this week then we can expect a bounce and a redefinition of resistance. A price failure at support of 4279 will most probably take price to a new support level which may be the 100 day moving average.
Because the 8 day MA has crossed below the 20 day MA this chart is now more bearish than bullish. A successful retest of Friday’s low may be an opportunity to enter a bullish trade on the Index ETF.
RUT: Strongest of the three tracking Indexes. After Wednesday and Thursday’s surge price action finished above the 8 and 20 day moving averages and changed their trajectory. Friday’s move bounced off the 20 day moving averages and closed in the upper portion of the daily range. This is a positive clue for this Index. Because of the large daily swings our key clues price action near the levels of support and resistance to determine any trade potential.
For those who attended the last Mid-Week training session on using intraday charts, pay attention to the clues provided on the 1-hour intraday charts for the Index ETF’s for potential trades.
If you have not had a chance to check out the research Mike Trager and I have done to start the EWA service you can find a short 10 minute preview at: http://youtu.be/MgC9GMAWh4w
If simplifying your life by trading along with us using the index ETF is of interest you can get the full background video at: http://activetrendtrading.com/etf-early-warning-alerts-video/
Remember if you are a premium or Early Warning Alert member you can receive Text Alerts and Trade Notifications if you send us your mobile phone number. Sent us your number with NO HYPHENS please and we’ll get you on the Text Notification List.
The How to Make Money Trading Stock Show—Free Webinar every Friday at 10 a.m. PDT. This weekly live and recorded webinar helped traders find great stocks and ETF’s to trade with excellent timing and helped them stay out of the market during times of weakness.
The “How to Make Money Trading Stocks” Show is back this Friday, March 20th
Ensure you get a seat by registering now at:
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Summary of Monthly Closed Trades as of the March 13th :
Invested at 0.0%
Total Booked Profits since Jan 1 when the timing service began: $ 176.25
ATTS Returns for 2015 through March 13th
Margin Account = +0.2%
Early Warning Alerts = +1.49%
Active Trend Trading’s Yearly Objectives:
– Yearly Return of 40%
– 60% Winning Trades
For a complete view of specific trades closed visit the website at: http://activetrendtrading.com/current-positions/
Updated at the beginning of each month.
For our all Active Trend Trading Members here’s how we utilize our trading capital
Trading Capital Setup and Position Sizing: Every year we start the year off trading a $100K margin account make the math really easy for yearly returns.
- Each trader must define their own trading capital in order to properly size trade positions to their own risk tolerance level!
- The $100K account is split between up to 4 stocks and a leveraged Index ETF. Actual number of shares will vary of course depending on price of the entity traded. We have found that limiting open positions to only 5 entities greatly reduces the trade management time requirements for members. This goes back to our goals of providing a system designed for members who work full time.
- Regardless of market conditions no more than 50% of available margin is used at any time.
- Each Trade is split 50-50 between Income Generating & Capital Growth Objectives unless specified in the Order Alert
- Naked Puts or short term options strategies will be used occasionally for Income Generating Positions
- None of the trade setups are a recommendation to trade only notification of planned trades from set ups using the Active Trend Trading System. Each trader is responsible for establishing their own appropriate risk level on every trade.
Managing Existing Trades: No open ATTS trades. Stops in place for EWA ETF trade.
Pre-Earnings Trade: NOAH reports earnings on Monday after market hours and there is no trade.
Potential Set Ups for this week: Stronger stocks rebounded with the markets on Friday. I expect some of these to potentially show some setups later in the week if the Indexes decide which way they want to proceed.
Upside: The stocks with upside potential may need to consolidate gains from last week or finalize their pullbacks. These include: ALK, AMBA, SNCR, AFSI, ARRS, NKTR and MBLY.
Downside: AKRX and GMCR are promising downside candidates. TSLA remains on the downside list but needs to bounce or break down further.
Toss Ups: This list is heavy this weekend and includes: LNKD, SAVE, PANW, BIDU, NFLX, VIPS, VDSI and HABT. Toss up stocks could go either way depending on market strength.
Other Toss Ups include:
Coming on the Radar:
Leveraged Index ETFs: The Early Warning Alert triggered last week and currently a half position is open in SPXL. We will look to add to this position or open up a position in either TNA or TQQQ if current support levels hold.
Comments and opinions written below this line of text may be provocative and only obliquely related to trading. Some may find these “Off the Wall” comments challenging to their outlook on life. I will not post any comments made on subject matter below this line, so if you disagree blast away.
OFF THE WALL
Off the Wall: Last week was a bit frustrating due to not getting in on 3 stocks that raced out of the gates for a nice gain. The orders were in place but did not fill. So when I run into disappointment do I scuttle everything and start going impulsive? No I don’t because I’m trading a proven successful system and I just have to keep applying the systems rules and things will average out over time.
A fact that few talk about in trading is that occasionally there will be dry patches. It is similar to an athlete who has hit the wall or is having a performance slump. An athlete knows that there will be peaks and valleys. These are just part of the natural cycle. But, when they overly dwell on the valleys getting out of the valley can be more challenging. Negative self-talk and negative expectations can come in and that is not healthy.
Same thing can happen to traders. They can have a great run and then out of the blue a dry patch. When this happens it is appropriate to check the journal and analyze the trades to see if there is a problem with the system or the trader. Sometimes this requires several trades to isolate an issue. If you find yourself getting into a slump sometimes it’s best to just step away for a few days. Another way of getting out of a trading slump is to paper trade. Normally this process will reveal a minor part of the process that is out of synch that can be corrected. Other times it is purely market driven.
As far as the mental side it is critical to accept that in trading there will be times when trades are missed or mistakes are made. The important point is to always mitigate risk as quickly as possible. With regards disappointments always remember—“The best trade of the year usually comes around about every 2 weeks!”
Keeping that in mind helps a great deal with the mental side and cuts
Share Your Success: Many of you have sent me notes regarding the success you are having with the Active Trend Trading System. Please send your stories to me at email@example.com or leave a post on the website. Thanks!