I am adding EXPE back as an Active Short Trade here around the 62 level. EXPE was recently a short trade that hit the first target for a 9% gain back in late Oct and then bounced and was moved to the Completed Trades category. I also mentioned that I still liked the pattern and that longer-term traders could give the trade a little more room as I might add EXPE back as another short trade soon. Based on these updated weekly and daily charts, I think that the stock is now offering an objective entry for a potentially long-term swing short trade. Longer-term traders might choose to focus on the two targets shown below on the weekly chart while shorter-term or more active traders might prefer to target any or all of the levels on this daily chart. Stops should be set according to which target(s) one prefers using at least a 3:1 R/R ratio. Those targeting only T1 could also consider a stop not too far above the recent highs, maybe around the 68.50 area. Daily & weekly charts:
I’m considering shorting some of the large bank stocks but I’ll just share these charts as “unofficial” trade ideas for now, possibly adding them as soon as I clean up the Active Short Trades category. I’d like to cull out some of the Active Shorts that may not have triggered a stop yet, many of which are even profitable but just not offering as good a risk/reward profile at this point as I’d like to see. Therefore, I plan to remove some of those trades soon to make room for some new short ideas that offer a better R/R profile at this time.
Here’s the weekly chart of the $BKX (KBW Bank Index) along with the daily charts of three of the largest TBTF (Too Big To Fail) but not too big to short (or drop in price). TBTF means that the US Gov’t will do whatever it can in it’s power to keep the doors open and lights on at the banks but in no way (contrary to the widely held belief of the general public) does this mean that the stock price of these banks is immune to significant losses and even the possibility of a total loss, should another financial crisis occur in the future. GM is one of many examples of this. The Gov’t essentially bailed out GM and kept the lights on for the company while the GM stockholders, prior to the 2009 bankruptcy, were wiped out. The GM shares that trade today were NEW shares from the post-bankruptcy company and the previous stockholders were not compensated or given any stake in the new company. Anyway, I’m not predicting any major collapse of the bank stocks, at least not at this point in time. Just looking for a likely 15-20% drop (possibly more) from their recent highs. $BXK weekly chart followed by the daily charts of JPM, BAC, and C:
The OCN short is up 11% since the recently posted backtest/add-on and still has plenty of downside left before reaching it’s price target (first and final). I’ve included a 4 hour chart along with the updated daily chart below. The 4 hour chart highlights a nice ascending & slightly contracting channel. A break below this pattern will likely be the catalyst for a move down to the one and only price target (29.25) but also realize that support IS support, until broken. Therefore, as this trade is already up nearly 11% from the original entry and up exactly 11% since the second posted entry or add-on level, this would be an objective area to book partial or full profits. One could also take a new short entry or add on to an existing position on a break below the 4-hour pattern. My preference and own plan is to hold out for T1 but I did want to point this support level out to those in the trade. Updated daily & 4 hour charts below:
One that I am not taking my eyes off is the AAPL long trade, which recently hit the first target (downtrend line) and as expected, pulled back and has consolidated under that level since. These type of consolidations at resistance are typically bullish as they allow the stock to work off the near-term overbought conditions which helps allow for a more sustained move higher if the stock is able to take out the resistance level. For those in the trade or looking to add-on or re-enter a position recently closed at T1, keep a close eye on the stock as it just started moving higher on strong volume and might be ready to take out that downtrend line soon, which would sharply increase the odds of the next target being hit (additional targets may be added to this trade). Updated 4 hour chart.
… That what I always tell my kids when coaching Little League. I try to incorporate that advice into my trading but there’s typically a limit to how many stocks one can successfully follow at one time before you get the proverbial “sand slipping through your fingers” from trying to hold too much. Either way, I did share the pattern and my thoughts on the previous post regarding EGLE and the stock has now gained 70% since that post exactly 2 weeks and 1 day ago today…wow.
As you can see from the notes on that previous chart, EGLE did indeed play out as expected by continuing higher to that resistance zone where it did, again as expected, pulled back and consolidated in a perfect bull flag continuation pattern before breaking out (which would have been a very objective entry/buy signal) and ripping higher. I would not chase the stock here and in fact, I think that the odds for a pullback from current levels are high right now. Nor would I be looking to add on a pullback anytime soon as the bull flag pattern has nearly played out to it’s projected measurement so any additional upside in the near-term might be limited. I did want to point that out to those who might have caught EGLE. Congrats to those who did. EGLE was also good for an “official” 32% on the long side back in Oct and a 20% gain in January 2012. I know of no other sector that can provide such quick gain but remember, that cuts both ways so do not become complacent with your stops, if you decided to trade these stocks.
I had planned to add EXM as a trade idea before the open today but something came up and I had to run out this morning and have been playing catch-up since returning less than an hour ago. Normally, I wouldn’t post a long entry on a stock that is up 25% but I do think that EXM, any sharp pullbacks notwithstanding, still has the potential for significant gains. In fact, on March 6th, I posted: Besides the miners (mentioned in the previous post) one of the sectors that will soon likely play a potentially powerful game of catch-up (assuming that the broad market continues to move higher over the next few weeks+) is the shipping index. I had added the NM (shipper) long shortly before that and even mentioned EGLE as one of my favorite in that post just a few weeks ago and EGLE is up 68% since then.
Again, these stocks can drop as fast as they rise so I would consider EXM an aggressive trade. If you decide to take it, consider adjusting your position size down to account for the unusually large profit and loss potential on this stock. The initial (and final for now) target and suggested stops are listed on this daily chart.
URG & SLW are both mining stocks with potentially bullish setups. The following charts and notes were shared from TheStockFox.com, which is an excellent resource for additional trade ideas, especially in the mining sector. Dax, who runs the site, and I share and bounce trade ideas off each other from time to time. Here are his notes and charts on these two trade ideas, for anyone looking from some additional trade ideas in the sector. I will add these to the Long Setups category but as these are not my trade ideas, even though I might personal take a position(s), I will not move these to the Active Trades category nor follow-up on these trades, assuming they trigger an entry (breakout). Just figured that I’d pass along the trade ideas as they do look promising.
I have no idea which way this will breakout, but if it breaks to the upside the targets are shown above, should it breakout to the downside I will update the chart with a daily. A stop would be placed on either side of the triangle consolidation.
BVN is another mining stock that I’ve been watching which has triggered a long entry on the break of these dual resistance levels (downtrend & horizontal resistance). I would prefer to see more volume on this move but as I’ve been stating, low volume breakout, although a possible sign of non-confirmation, seem to be the norm lately. Targets and suggested stop for T2 (preferred target) listed on this 60 minute chart.