• AON - Sep 23 201420140923
  • BC - Apr 14 201420140414
  • BXS - Oct 16 201420141016
  • CVX - Jan 13 201420140113
  • EVR - May 07 201420140507
  • FFIN - Aug 14 201420140814
  • FISV - Oct 13 201420141013
  • FRC - Oct 13 201420141013
  • HIBB - Sep 08 201420140908
  • HMN - Apr 11 201420140411
  • HSY - Jul 21 201420140721
  • KBE - Jul 21 201420140721
  • KRE - Jul 31 201420140731
  • LYV - Aug 06 201420140806
  • OZRK - Sep 23 201420140923
  • $RUT-IWM - Oct 21 201420141021
  • SAVE - Oct 16 201420141016
  • $SPX-SPY - Oct 02 201420141002
  • TSLA - Sep 23 201420140923
  • XHB - May 06 201420140506


Active Trades – Short

Active Trades are trade ideas that were previously posted as Trade Setups and have since triggered an entry or occasionally, a trade idea that was first posted directly to the active trades category as offering an objective entry at the time of the initial post. Active Trades might also be listed in one or more of the other trade categories as these categories are not necessarily mutually exclusive. E.g.- An Active Trade that still offers an objective entry might also be categorized under the Trade Setups category. Likewise, an Active Trade with multiple prices targets may have already hit one or more of those initial targets with additional target(s) remaining, thereby falling under both the Active Trades and Completed Categories. Traders should look to make any new entries or add to existing Active Trades objectively, such as a on pullback to a support level during an uptrend or a re-test of a broken trend-line, wedge, or channel pattern.

Oct 212014
 

This first chart below is the weekly chart of the $RUT (Russell 2000 small cap index) with my current final downside target of 862 as well as some of the minor support levels along the way. The second chart is the update 120 minute (2 hour period) chart of the IWM ($RUT tracking etf) with the same suggested stop levels that were recently posted on this chart. The $RUT led the US indices on the way down, peaking back on July 1st, months before the $SPX, $NDX, $DJIA, etc.. and falling over 14% into last week’s lows. As would be expected, having fallen the most both in time & scope, the extremely oversold & higher-beta $RUT has been one of the leading indices the way up on the recent oversold rally since Wednesday’s lows, up about 6.5% since then. As impressive as this bounce may appear, so far (as of today’s highs), the $RUT has only retraced 38.2% of that 14% plunge off the highs… a typically minimum Fibonacci retracement or counter-trend bounce of a larger impulsive move.

Once again, multiple targets are listed on IWM short trade that was added on Thursday to accommodate various trading styles & price targets. For those just looking to position short on this bounce with the expectation of covering on the next price target of 1010 on the daily $RUT chart, a stop no higher that the 111.10 level would be prudent. For longer-term swing traders targeting a move down to the 862 area, about 20% below where the IWM short trade was added, a stop above the 144.55 level (stop 3 on the 120 minute chart) would still provide an attractive R/R of nearly 4:1.

At this time, just about every major index that I track is still trading well below the recently broken long-term bull market uptrend lines and the intermediate-term trend, as well as all but the fastest short-term trend indicators remain on sell signals. That could certainly change should the markets continue to rally sharply but until that time, most active traders should consider shorting bounces back to resistance. Until/unless the current sell signals flip back to bullish, the odds of long-side breakouts failing before reaching the measure target of the pattern is elevated (referring to typical equities that trade in-line with the broad market).

Oct 172014
 
IWM 120 min Oct 17th

IWM 120 min Oct 17th

Here are a few suggested stop levels for the IWM short trade. The first stop would be just above that shaded box which encompasses the 109.80 horizontal resistance as well as a Fib cluster, the 38.2% & 50% retracement levels of the two prior reaction highs. The next stop, stop 2 at 112.42 lies just above the 112.20 horizontal resistance and another tight Fib cluster (50% & 61.8%) with the upper-most suggested stop above 144.55, which comes in around the 61.8% retracement of the move down from the July 1st peak in the $RUT/IWM. Which stop(s) one uses would be based on their preferred downside target(s) in the $RUT/IWM (i.e.- the lower your price target, the higher your stop).

I had mocked up a daily chart of IWM with some potential target areas last night but either inadvertently saved it to the wrong watch-list or didn’t save it at all. If I can’t find it I’ll work up another chart today but as of now, based on my interpretation of the weekly chart, I think a move down to the 875 level on the $RUT (about a 20% drop from current levels) is certainly a possibility in the coming months at this time. Of course, if that proves to be the case, we would almost certainly experience some very quick counter-trend rallies along the way.

Oct 162014
 
$RUT daily Oct 16th

$RUT daily Oct 16th

Yesterday, the $RUT (Russell 2000 Small Cap Index) hit the second downside target (T2 at 1040) that has been listed on the daily chart under the Live Charts page for months now. As if most often the case, the typical reaction (bounce and/or consolidation) immediately ensued. That bounce is now approaching the base of the double-top pattern that I’ve also been highlighting on that same chart for months now as well. In fact, the base of that double-top patten was the first downside target which was just recent hit & then taken out a few sessions later, triggering a breakdown of that pattern which actually projects down to the 960 area, a drop of about 11% from current levels if reached.

With the bottom of that double-top pattern at the 1080-1082 level & the $RUT trading at 1081 as I type, a short entry here on the $RUT (IWM) with the appropriate stops somewhat would have to be consider a very objective entry with a very favorable R/R (risk-to-reward ratio. As such, IWM will be added as an Active Short Trade here around the 107.50 level.

I will follow up with the specific IWM targets soon but just wanted to get this trade idea out asap in case we do get the expected reversal off of this backtest of the 1080-1082ish resistance level. For those preferring to use one of the leveraged ETFs as a proxy for an $RUT short (TWM, TZA, etc…), keep in mind that this trade is intended as a multi-week swing trade and therefore, at most I would consider using TWM (2x short $RUT) as the decay on the leveraged ETFs, especially the 3x like TZA, will almost certain impact the returns if held for more than just a few days.

The live, annotated version of the $RUT daily chart can be accessed via the Live Chart Page or the Live Charts Links widget box on the right-hand sidebar of the home page.

Oct 162014
 
SAVE daily Oct 16th

SAVE daily Oct 16th

The SAVE (Spirit Airlines) short trade hit the first profit target (T1 at 53.38) for a 23.3% gain on Monday and has so far traded around that level every day this week.

This is one of many recent examples of why multiple price targets are used as reactions (i.e.- a bounce or consolidation) are common upon the initial tag of each price target. Consider booking partial or full profits and/or lowering your stops if holding out for T2 (48.27), which is remains the final target on this trade.

Oct 162014
 
BXS daily Oct 15th

BXS daily Oct 15th

The BXS short trade hit the second target, T2 at 19.33, yesterday for a profit of 18.1% since the original short entry. Consider booking full profits and/or raising stops, depending on your trading plan. T3 at 18.30 remains the final target for now but as always, reactions off the initial tag of each target level are likely.

Oct 132014
 

The previously posted FISV (Fiserv Inc) short trade setup broke down below the daily uptrend line last Tuesday & went on to print a weekly close below the ascending price channel on the weekly chart last week, a more powerful, longer-term sell signal. With prices still in close proximity to the breakdown, this trade still has plenty of meat on the bone & still offers an objective short entry around current levels. I’ve added one additional price target at 59.34 (actual support around 59.30) & have re-sequenced the previous two targets as T2 & T3. Suggested stops would be based on a 3:1 R/R to one’s preferred targets or slightly above the recent highs if targeting the final target, T3 at 47.77.

click here to view the daily chart of FISV       click here to view the weekly chart of FISV

Oct 132014
 
FRC daily Oct 13th

FRC daily Oct 13th

FRC (First Republic Back) was added as an Active Short Trade back on July 31 at a price of 46.88 with a relatively tight suggested stop of 48.10. The stock bounce a little further than I had anticipated (in sympathy with the broad market) and went on to slightly exceed that suggest stop level for a relatively minor loss of 2.6%. Therefore, that previous trade on FRC will be considered stopped out for a loss and that previous short-entry post will be re-assigned to the Completed Trades category where it will be archived indefinitely for future reference.

FRC will also be added directly as a new Active Short Trade here around the 47.42 on this break below the bear flag pattern which follows the breakdown below the 3-year primary uptrend line. T2 (40.50) is the current final & preferred target with a suggested stop above 49.50 or lower, if only targeting T1.

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