Good Day Traders,
May has been an active month for Active Trend Trading now that we have integrated the Hull Moving Averages into the system we have provide several trades that have done well and expect picks continue to grow going forward through the remainder of 2015.
This weekend is Memorial Day Weekend. I encourage each person to take a bit of time just to be thankful for those who gave their lives for the liberty and freedom we enjoy. Never give up that what was fought for throughout the history of this great country!
Thanks for all the great comments about the ATTS service and the “How to Make Money Trading Stocks” webinar that blast out every Friday at 10 a.m. Pacific. Please let others know about this great webinar! You can either join live or catch the replay on YouTube.
Here’s the link for next Friday’s Show: https://attendee.gotowebinar.com/register/5922198692335832065
For Premium Members our Wednesday evening training is developing some fantastic traders!
Mid-Week Market Sanity Check Topic: Designing Trades Based on Proper Set Ups
General Market Observation: Each of the Indexes finished with weak price action. Often trading after Memorial Day becomes weaker due to the Summer Doldrums. Will that happen again this year? The daily charts and weekly charts are starting to synch up but in the upper reversal areas. As we know the indicators can look weak for a long time before traction to the downside takes effect. Each of our tracking indexes are respecting levels of support and resistance better than the moving averages.
SPX: The S&P maintained its breakout above 2120 this week and then stalled. It appears that the daily and weekly charts are coming into synch but not lining up for much more upside. We are entering that time of year when the summer doldrums can take over which can still move the markets higher on weakening fundamentals until putting in a more significant correction between now and August. We will watch for the clues and some may have started to show up this past week. Friday’s price action finished with a Bearish Harami at a support/resistance level that could go either way. The shorter term Hull Moving Average (HMA) has turned down and pink indicating that a pullback may be in order. At this point with the exception of being slightly extended the other moving averages are looking positive on a daily chart. The weekly chart is still showing negative divergences with the indicators. The weekly candle was another spinning top at a support/resistance level. Next week is a toss-up regarding price action direction. If price closes below 2120 this may indicate that a pullback to at least the 50 day EMA is in order.
Preferred ETF’s: SPY and SPXL
NDX: The NASDAQ 100 finished Friday with a Bearish Shooting Star reversal pattern on the daily chart. If prices reverse below the previous high from 4/27 then that would be a lower high and may indicate that prices are moving back in to the downside phase of the current sideways movement. As with the S&P next week will be toss-up either moving up to previous resistance around 4550 or dropping back into the range. Look for support at 4483 and the 50 day EMA.
Preferred ETF’s: QQQ and TQQQ
RUT: The Russell looks most likely to drop next week based on the daily charts. There is support at 1248 which lines up with the 8 day EMA and the 50 day EMA. Price action from Tuesday through Friday was indecisive and down slightly. The daily HMA has turned pink and is rolling over. The weekly HMA has turned pink and served as a level of resistance this week. On some of the recent drops both the 8 day and 20 day EMA’s have not provided great support or resistance. Until this characteristic changes I will rely more on defined levels of support and resistance from past price action. Support levels are well defined at 1240, 1230 and 1210.
Preferred ETF’s: IWM and TNA
The Early Warning Alert Service has hit all three major market trading point this year. See this brief update video for more details: https://youtu.be/PRLmPQLHjiI
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/
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, May 29th
Ensure you get a seat by registering now at:
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ATTS Returns for 2015 through May 22, 2015
Margin Account: 21% Invested
Margin Account = +2.5% (Open and Closed Positions)
Early Warning Alerts = +6.0%
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:
INCY: We only have 50 share open after closing out 50 shares of this stock when price hit the 110 target level this past Thursday. At this point we are applying the 8 day EMA rule as the profit stop on the remaining shares. On the 150 share closed so far the gain has been 6.7% since May 5th. If we get a pullback to another entry action point this I will open another full position and send out the alert to members.
ARRS: Friday’s price action almost hit the stop loss at 32.50 but rebounded off support. The price action pattern on ARRS is constructive but buying volume needs to kick in soon. T1 = 36 on have the shares. Friday’s candle was a Hammer at support but price now below the HMA, 8 day and 20 day EMAs.
Special Trades: The June 32.5 Call on ARRS hit its stop-loss on Friday and the position closed at 1.15 for a small loss on the 5 contracts. Of course the stock rebounded shortly after this but we do not double down while the price action is trying to determine which way to go!
Additionally some of these trade may be selling weekly puts on up trending stocks. If you are interested in parallel trading this strategy register at this link: http://forms.aweber.com/form/99/1278533099.htm
Pre-Earnings Trade: Just a few stocks to watch over the next couple of weeks. AMBA has been atop the IBD 50 for many weeks and reports 6/2 AMC. PANW reports on 5/27 AMC. AVGO and ULTA rounded out the list reporting on 5/28. If you are long any of these stocks going into earnings with less than 10% profit it might be a good idea to take at least partial profit or total profit prior earnings.
Potential Set Ups for this week: It appears that this week will provide a target rich environment for stock picking with several stocks close to entry action points. Remember also that currently fewer stocks are supporting the current uptrend so any long stock position may hit profit targets in the 5-10% range and then stall.
Upside: The list of potential upside movers include, THRM, SWKS, BITA, VDSI, XRS, BABA and CYBR.
Downside: GMCR and QIHU still look weak.
Toss Ups: Several stocks look ready to move but the direction is a toss-up. These include CELG, BIDU, VIPS, AAPL, ARRS, HABT, FLT, INCY and YY.
Leveraged Index ETFs: The Early Warning Alert fired off a couple of weeks ago and up nicely on the TNA position with only about 4-7 days remaining in the 21-24 day holding period. There is a strong resistance zone between 93-95. This level would be an appropriate target to close this position if hit prior to the 21-24 day holding period.
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: Memorial Day—a day to remember those who have fallen in conflicts defending our freedom and liberty. On this day I always remember my dad and his service in the Navy during WWII. He operated landing craft filled with Marines and delivered them onto the beaches of every Island in the Pacific Theater. He would drive his boat onto the beach drop the gang plank and the Marines would charge ashore to battle. Many of his fellow landing craft sailors would be blown up and never returned from those crimson waters of those Pacific Islands. On rare occasions he would share some of the stories from then both the good and the bad, and I could see in his eyes that fighting for his country left an indelible mark that he carried the rest of his life. Yes it was with great dignity he lived knowing the sacrifice he and his fellow warriors made. Up until the day he passed away he was always ready to defend this country that he loved. Thanks Dad for what you did, you will always be my hero! Love you & miss you!
Outs & Ins: This weekend only one stock made a debut to the IBD 50, that is GTN. Above average buying volume was present this week on GTN as it broke out of a consolidation pattern. Use 14.80 as the breakout pivot for any retest. Take a look at a weekly chart and see that this is not a new high for GTN. While the old high from 2004 may not have a large influence on current price action it may act as resistance around the $16 level.
The current Running List is up to 140 stocks and many stocks have been just rotating on and off the list depending on how they sort out in the bi-weekly computerized criteria. Use the weekend to look for stocks on the Running List that may have dropped considerably for potential early entries on any rebound. One never knows if a DDD will show up like it did in 2013.
THRM is putting in a nice pullback to support!
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!