Jan 232015
 
P daily Jan 23rd

P daily Jan 23rd

P (Pandora Media Inc) will trigger a long entry on a break above this bullish falling wedge pattern -OR- the 17.60 level, whichever comes first. The stock is already quite extended today and may or may not need another thrust down within the wedge pattern before building the energy to mount a solid & sustained breakout. As such, if the stock were to clear the 17.60 level in the next day or so, a lower-level backtest of the wedge would be a likely possibility. Therefore, it might be prudent to take a partial position on any near-term breakout in order to add a second lot, should a backtest of the wedge occur.

Pandora was added as a short trade back in March 2014 on the break below both the ascending price channel & horizontal support. P hit the final price target (T2) for a 25.3% gain the following month and went on to move slightly lower to the highlighted 21.70 support/former final target level (T3) with the stock forming a divergence low when that key support level was reached. From there, the stock rallied over 38% and has since moved lower in a bullish falling wedge pattern, complete with bullish divergences on the MACD, RSI & CMF.

One alternative, slight more aggressive entry would be to establish a fractional long position if P were to pull back to the 16.10 level with a stop set just below the recent recent reaction low of 15.26. Although that would be a lower probability vs. waiting for a breakout above the pattern, the downside risk (about 5.3%) would be relatively small compared with the upside potential (23% & 33% to T1 & T2), should this pattern play out as expected, or about a 4:1 & 6:1 R/R.

Also note the R1 (1st resistance) level at 18.60 which could provide a level for very active traders to book quick profits (partial or full).

Jan 232015
 
PT daily Jan 22nd close

PT daily Jan 22nd close

I have decided to set the official price target on yesterday's PT (Portugal Telecom) Long at 1.14 (T1) with additional potential targets, T2 at 1.25 & T3 at 1.52, to be added depending on how PT trades going forward.

T1, the current preferred & final target, is set slightly below the top of the Dec 29th gap although an optional, higher probability exit point would be to set your sell limit order slightly below the bottom of that gap which comes in at 1.13.

Another option that might help extend gains on this trade would be to set a relatively tight trailing stop (~0.05) below PT once/if the stock approaches the 1.13 level while targeting either T2 or T3. Unless stated otherwise beforehand, PT will be considered a completed trade if/when T1 is hit.

click here to view the live, annotated chart of PT

Jan 222015
 

PT (Portugal Telecom) will trigger an AGGRESSIVE long entry on a break above 0.95. I have yet to determine my exact price targets but plan to follow up with some suggested target levels assuming the stock makes a sustained break above the 0.95 resistance level. However, the 60 minute chart below shows some potential near-term targets (actual resistance levels shown, best to set sell limits slightly below) and the two gray horizontal lines on the daily chart also represent some possible targets. As of now, my focus is on the 60 minute chart, currently targeting that gap that runs from about 1.13 to 1.17, which would translate to about a 20% gain if hit. As such, a stop of around 6-7% would make sense for those targeting that area. 60 minute & daily charts below:

A few days ago, I posted here about flexible vs. rigid trading plans. The previous (and only other) trade on PT was a long trade that was completed for a 28.4% gain back on January 17, 2013. Two days earlier, my analysis of the charts convinced me to revise down my final target from around the 6.70 level (T3) and make T2 (5.65) my final target. Just two days after that downward revision suggesting to book full profits if & when T2 (5.65) was hit, PT hit that final target. The very next day, Jan 18th, PT reached a high of 5.49 and immediately embarked on a plunge of over 86%, never looking back. Just another example of reacting to changes in the technical of a position and not becoming married to a trading plan that was put in place months early. Those previous trades on PT, as with all trade ideas on RSOTC, can be viewed by clicking on the "Tagged with: PT" link at the bottom right of this post or by using the "Select Ticker" drop-down box on the sidebar of the homepage.

NOTE: THE SITE HAS BEEN EXPERIENCING SOME UNUSUALLY LONG DELAYS IN UPLOADING IMAGES TODAY. I JUST NOTICED THAT PT IS NOW TRADING ABOVE THE TRIGGER PRICE OF 0.95 AS I TYPE, MAKING THIS BOTH A TRADE SETUP AND ACTIVE TRADE.

Jan 222015
 
ABX daily Jan 22nd

ABX daily Jan 22nd

The ABX (Barrick Gold Corp) long trade has hit the second & final target (T2 at 13.21). As this was the final target, consider booking full profits or at least raising stops if planning to hold ABX as a long-term trend trade or investment.

Regarding the miners in general, GDX is still quite extended while struggling with resistance around the 23.00 area. On Tuesday's post titled "Pullback in the Miners Likely...", I stated that I was only "looking for a pullback to around the 22 area". GDX did indeed pullback yesterday, falling as low as 22.10, close enough for government work although I suspect that we could possibly get one more run down to the 22 area, possibly lower although with the fact that a decent pullback in the miners already occurred (helping to alleviate some of the near-term overbought conditions), I don't believe that the odds favor another short/pullback trade at this time.

Personally I was holding out for a slightly larger pullback before covering (selling) my GDX short (DUST) and adding back exposure to the sector and with GDX still trading below yesterday's high, I will continue to hold DUST until we either get one more thrust lower (targeting the 13.75 area on DUST) or I am stopped out (on a move above yesterday's high of 23.22 in GDX).

Just to reiterate, I remain longer-term bullish on the precious metals & mining sector. Longer-term traders & investors who are also bullish and have been accumulating gold, silver, platinum and/or mining stocks should not be overly concerned with the short-term swing targets and analysis based on intraday charts, other than to possible help time entries/add-ons and in managing/ratcheting up stops.

Remember that a very bullish case, both from a technical and fundamental case was made for the mining sector all the way back on November 7th in this post (click here to view). At the time, GDX had just hammered off of the bottom of a descending broadening wedge (DBW) pattern (bullish price action) on the weekly time frame with strong bullish divergences in place. The first chart below was one of two charts from that post highlighting the pattern (the other chart made a bullish case for the miners based on valuation) and the second chart below is the updated weekly chart of GDX. Note the large volume surge leading into the November lows as well as the high volume on the impulsive move higher since. While I would expect some pullbacks along the way, my expectation remains a continued move higher to at least the top of the large DBW pattern.

Jan 212015
 

These are the latest 60 minute charts on both UCO (2x long crude oil ETF) and USO (1x long crude oil ETF). Based on my analysis of the charts, I still expect an decent oversold rally in crude oil from at or near current levels although in hindsight, I thought that the bounce would have already played out by this point and as such, should have opted to trade USO instead of the leveraged UCO, which has basically choppy around in a trading range since the original entry two weeks ago.

Regardless of the fact that crude prices did not immediately make a sustained rally towards the initial price targets following the breakout above the 60 minute bullish falling wedge pattern, the sideways price action over the last couple of weeks could be due to the fact that crude is forming a base from which to launch decent rally up to my current preferred target of the 10.58 area (with a suggested sell limit placed slightly below). Any solid and sustained break above the bottom of this recent trading zone would be bearish & most likely open the door to a new wave of selling.

The 18.60 area has formed a decent resistance level over the last few weeks and as such, any solid break above that level is likely to be the catalyst for a relatively quick move towards the 19.80 resistance level (first target on USO) and quite possibly the 20.54 level after that (which is comparable to my 10.58 resistance level on UCO).

Jan 212015
 
SLV daily Jan 21st

SLV daily Jan 21st

SLV (Silver ETF) hit the second & final short-term swing target today. That tag of resistance also corresponded with a kiss of the top of the ascending broadening wedge pattern that was first discussed in the January 9th Precious Metals & Commodities Outlook video.

Once again, I would like to reiterate that I remain longer-term bullish on gold, silver & the mining sector but in light of all of the major precious metals making an near-term overbought run into resistance over the last day or so (the PPLT/platinum long trade also hit T1/resistance yesterday), we may continue to see some additional profit taking and/or sideways consolidation in the miners before a solid resumption of the uptrend. More active swing traders might consider booking partial or full profits and/or raising stops on SLV while longer-term traders & investors might consider raising stops at this point and strategically adding to their metals and/or mining positions on pullbacks to support.

Jan 212015
 
NOV 60 minute Jan 21st

NOV 60 minute Jan 21st

NOV (National Oilwell Varco Inc) was one of the energy sector bounce candidates from Jan 13th and looks even better today after clearing this minor horizontal resistance level. T1 & T2 are the current bounce targets with additional targets to be added depending on how crude trades going forward.

With today's breakout, NOV offers an objective add-on or new long entry. Consider a stop calculated on an R/R of 3:1 or better depending on your average entry price. Current & potential price targets are listed on this 60 minute chart with the exact suggested sell limit levels to follow on the next update.

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