I’m continuing to keep things light for now as the overall technical picture for the broad market (S&P 500) is not as clear as I’d like it to be. However, with both the Nasdaq 100 Index as well as the important financial & energy sectors currently backtesting their recently broken uptrend lines as shown below, adding back some short exposure here with the appropriate stops in place does seem objective. I’ve recently updated all of the live charts for the gold & silver mining stock trades as well as the US Indices. Those charts are accessible via the Live Charts page. Static charts on those mining stocks that recently hit a profit target will be posted asap for archiving purposes although most of those trades were updated in the recent post titled Reducing Exposure to the Gold Mining Sector last week.
JO (iPath Dow Jones-UBS Coffee Total Return ETN) has now hit the second price target (T2 at 31.65) for a gain of 35.2% from the original entry price (or higher for those who entered/added at lower levels on the recent backtest). As always, consider booking partial or full profits and/or raising stops, depending on your trading plan. T3 at 33.98 remains the final target for JO at this time although as is typically the case, a reaction (pullback and/or consolidation) around this target level is likely before prices continue higher.
NMO (Nuveen Muni Opportunity Fund) hit the final target of 12.52 & will be moved to the Completed Trades category. Consider booking partial or full profits and/or raising stops to protect profits for those planning to hold NMO as a longer-term income producing investment. With a current tax-free* distribution rate of 6.35%, NMO still offers a very attractive after-tax income stream for investors in higher-tax brackets seeking current income. (*Most or all dividends free from federal but not necessarily state income tax. Click here for more info on NMO)
FFC (F & C Claymore Preferred Securities Income Fund) hit the sole profit target of 18.72 last week & will now be moved to the completed trades category. Consider booking partial or full profits and/or raising stops planning to hold FFC longer-term as a income producing investment.
As mentioned last week, numerous trade ideas have recently hit one or more profit targets. For categorical purposes, static charts are posted as profit targets are hit on the trade ideas on RSOTC. This provides a pictorial history of the trade ideas from trade setup, breakout/entry, and how the stock reacts at each profit target, which can be used as an education resource in which to study the past price action of a particular stock or technical price pattern. All posts on RSOTC, including failed trades, market analysis, etc…, are archived indefinitely and can be easily referenced by using the symbol tagging system.
As I took some time away from trading over the last week (a must from time-t0-time in order to prevent trader burn-out), I am going to focus my efforts on updating those trades that recently hit an intermediate or final profit target. As most of those trades were already mentioned on Friday, email notifications will not be sent out on each static chart update. Just a quick note that my degree of confidence on the near-term direction of the market is still not very clear and as such, I plan to keep things light for now (both my trading/positioning as well as market updates).
With that being said, here is the updated daily chart of the JPI Growth & Income Trade along with the previously posted charts. JPI hit the final (and only) price target of 23.18 to the exact penny last week before reversing, providing this trade with a total return of 9.6% (including $1.33/share in distributions paid out since entry). As with most of the other Growth & Income Trade Ideas that have recently hit there final price target, these trades may very well continue to provide attractive returns for investors seeking above average yields. As a more active trader, my preference was to close these positions when my final target was hit in order to redeploy that capital into other trades with a better R/R profile and higher profit potential. In other words, now that my final target has been hit on JPI and several other of the recent G&I Trades, I believe that the bulk of the “Growth” component has been milked from these trades, at least in the near-to-intermediate term. However, the high dividend yields, i.e.-“Income”, on these trades may still provide an above average return for investors, particularly those who entered these trades at lower levels. If so, stops can be raised at this point in order to protect profits while continuing to collect the above average dividend payments. As 23.18 was my final target for JPI, this trade will now be moved to the Completed Trades category where it will be archived for future reference.
Although I wasn’t planning on trading much this week, I have booked full or partial profits on numerous positions, including both the aforementioned Growth & Income Trade Ideas as well as GDX and numerous individual gold & silver mining stocks. All in all, I have probably booked profits on at least 2/3rds-3/4th of my total exposure to the mining sector today & would prefer to wait for a pullback before adding back exposure to the sector. I plan to post the updated static charts and some additional commentary on these trades over the 3-day weekend but until then, here are some of the active gold mining stock trades that have recently hit or exceeded a profit target and which the chances of a decent pullback are elevated at this time:
AEM: T1 hit & slightly exceeded.
ANV: T1 hit Wednesday & yesterday with prices sharply moving above that level today.
AUY: Also hit T1 on Wednesday & has moved sharply above that level today (potentially bullish if today’s move sticks and prices don’t move too far back below the T1 level).
EGO: T2 hit today.
GDX: T2 hit today.
HMY: T2 hit today.
KGC: T1 hit on Tuesday & still trading at that level today.
PAAS: T2 (final target) hit & exceeded today.
SSRI: This one did exceed the previously suggested stop but was left on as an Active Trade as the longer-term charts remained constructive. I realize that I never did follow up with suggested targets for the most recent entry but prices are now back to the final target (T4) of the previous trade which is my final target (I just closed my entire position).
TRX: T2 (final target) hit & exceeded today.
As I don’t have access to my primary desktop computer today, I am unable to post static charts. However, the previous notes & charts on these trades, including live charts on most, can be accessed by clicking on the symbol tags at the bottom right-hand side of this post.
GDX (Gold Miners ETF) has now hit the top of the second target zone. Consider booking partial or full profits and/or raising stops, depending on your trading plan. I’m working remotely so can’t post a static chart although the live chart of GDX can be viewed by clicking here. Profit targets are set at levels where I believe a reaction (pullback and/or consolidation) is likely. T3 remains my final target for GDX at this time. With the mining sector up sharply this week while I have been taking some time off, some of the individual mining stock trades may have also hit profit targets lately. Best to have your sell limit orders and stop-loss order in place (GTC), especially if you do not have the luxury or willingness to be on the computer all day. I plan to update the trade ideas over the weekend.
In taking some time off this week, I just noticed that several of the active long Growth & Income Trade Ideas have recently hit an initial and/or final profit target. I have a few things outside of trading to take care this morning but will post updated charts on each of these trades later today or over the weekend. As always, all previous charts and commentary on any trade idea posted on RSOTC can be quickly referenced via the symbol tags. Symbol tags for each stock, ETF or index mentioned in a post will appear at the bottom right hand of each post (e.g. Tagged with: AAPL, $SPX/SPY). Simply click on the symbol tag in order to view all posts related to that symbol sorted by date.
The following Growth & Income Trades have recently hit an initial and/or final target & are still trading at or near those levels, for those wishing to book profits. Although most of these trades have hit my final target & will be considered completed, most, if not all of these trades may still prove to be good long-term holds for growth & income investors who entered the trades when they were initially posted or triggered as these trades still have very attractive dividend yields. As always, consider booking partial or full profits and/or raising stops to protect profits once your preferred profit target(s) are hit. More on these trades later.
AGNC- T1 hit, T2 remains final target.
FFC- T1 (sole target) hit.
JPI- T1 (sole target) hit.
NMO- T1 (sole target) hit.
I am back in the office today but still preferring to keep things light for now as the near-term direction of the market is just not very clear. Although a longer-term bearish case has been made and I still do favor more downside to come in the following weeks-months, the intensity snap-back rally over the last several trading sessions does somewhat temper my desire to aggressively reposition short.
At this time, the SPY/$SPX is trading around the intersecting horizontal & trend resistance level which also comes in at the 78.6% Fibonacci retracement of the recent sharp move lower. Any solid break & close above this level would open the door to new highs in the S&P 500 as this is the last significant resistance level before the Jan 15th highs. To reiterate, based on my analysis of the longer-term (daily & weekly) charts as well as other metrics such a recent sentiment extremes preceding the mid-Jan highs, I continue to feel that the intermediate-term outlook for the market is bearish but would prefer to see some additional technical evidence, such as a resumption of the near-term downtrend. BTW- most of my short-term indicators remain on sell signals as of now, but will flip to bullish if the market moves much higher over the next trading session or two.
There are several trade ideas in need of updating which I hope to get to by the end of the week. Market analysis and trade updates will continue to be light for now as the near-term technical outlook isn’t very clear although that could change on a dime. I also woke up to error messages telling me that the primary hard drive on my main computer is at risk of failing so after backing up all data & attempting (to no avail) to fix the errors, I will now turn my efforts to restoring my data it to the backup drive, which could take a better part of the day. Feel free to contact me if you have any questions about any of the existing trade ideas. -RP
I’ll be away from my desk today and possibly until tomorrow so there won’t be any new trade ideas, updates or market commentary posted today. As far as the broad markets go, the $SPX is now trading around the 61.8% Fibonacci retracement level of the move down from the Jan 15th (all-time) high to the Feb 5th reaction low. The 61.8% retracement level is a common ending point for counter-trend bounces, assuming that is what this is (still my primary scenario). Of course many counter-trend bounces exceed the 61.8% retracement level so it’s not a hard line in the sand.
Not too far above current levels is also one of the alternative scenarios which I recently shared and that would be a backtest of the uptrend line/bottom of the rising wedge pattern on my daily SPY & $SPX charts. A backtest of that trendline over the next few trading sessions, assuming the market continues to move higher from here, would also coincide with the key horizontal resistance level that was highlighted on the SPY daily chart posted on Jan 30th. That horizontal resistance come in around 181.60-181.85 on the SPY and 1812-1815 on the $SPX. Any solid close above that level will call the bearish scenario into question and open the door for a move to new highs. Sorry but no time to post charts today, possibly later tonight if I get the chance. -RP