Apr 072014
 

The LNKD (LinkedIn Corp) short trade has hit the third profit target, T3 at 166.30, for a 26.5% gain from entry. Consider booking partial or full profits and/or lowering your stops, depending on your trading plan. T4 at 127.20 remains the final target at this time although the odds of a near-term reaction (bounce or consolidation) around the T3 level are elevated at this time. Previous & updated daily charts below:

Apr 072014
 

The third near-term target (of the 60-120 min time frame targets) on the QQQ has been hit with the Q’s down almost 6% from the where the recent bearish rising wedge pattern was first highlighted. Although a reaction (pause or bounce) here is likely, I continue to favor more downside before any substantial (3%+) move higher. At this point, with the short-term trend bearish for exactly one month now (the QQQ/$NDX topped on March 7th) and the intermeditate-term trend moving closer to bearish territory, to  I start to turn my focus more on the daily charts in order to help determine the most likely path for the markets going forward. Doing so helps to determine which profit target(s) to use in closing out my short trades. Although things can change quickly in the markets, at this time I believe that any rallies are likely to be relatively minor in scope and duration and a move down to the T4 level on the 120 minute chart (which is also T1 on the $NDX daily chart) in the coming days is likely. With that being said, the markets are getting oversold on the short-term time frames and with both the Q’s & SPY at support (the SPY is back to the top of my 60-120 min T1 zone), in general I am not interested in adding any more short exposure with the exception possibly being a very attractive short trade bouncing back to a solid resistance level or some other very compelling, high R/R entry.

The charts below are the most recent string of the 60 & 120 minute QQQ charts. This move down so far has been nearly textbook with the first 60 minute chart posted back on March 5th highlighting the QQQ at the top of the most recent bearish rising wedge pattern. From there, prices went on to make one final tag & bounce off the bottom of the wedge, breaking down below the wedge shortly thereafter, followed by a near-perfect backtest from below and the Q’s continuing to fall from there while making a series of lower highs & lower lows (i.e.- a downtrend).

Apr 042014
 

AAPL (Apple Inc) is currently trading well below the symmetrical triangle. First downside target would be the 200ema/515.60 area.  click here to view the live daily chart of AAPL

AAPL daily April 4th

AAPL daily April 4th

Also keep in mind that the 200-day EMA, which is the same as the 40-week EMA, has done an excellent job of defining major bull & bear trends in APPL in recent years as evidenced on this 10-year weekly chart. click here to view the live weekly chart of AAPL

AAPL weekly April 4th

AAPL weekly April 4th

 

Apr 042014
 

SNDK (Sandisk Corp) looks to offer an attractive R/R with a short enter here on what looks to be shaping up as a shooting star (a potentially bearish topping candlestick formation). A stop over today’s high of 85.37 would provide about a 3 point downside risk while my preferred target range on this trade (exact targets TBD) would be at least 10 points lower & quite possibly nearly 20 points lower, if this trade & the markets continue to play out as expected. If conditions are favorable, I will occasionally enter a short trade at the top of a rising wedge pattern (or the bottom of a bullish falling wedge pattern for longs) as the potential gains on the trade, assuming that prices reverse and go on to break down from the wedge and continue to play out to the measured target of the pattern, are very large compared to downside risk if stopped out as tight stops can be used. Shorting the top (or long at the bottom) of a wedge typically has a higher chance of failure on the trade (vs. waiting for a breakout of the pattern) but when factoring in the above average R/R, on balance I’ve found these type of trades to be very profitable.

SNDK daily April 4th

SNDK daily April 4th

Apr 032014
 

XVX.TO is an Active Long & Long-term Trade idea that was first added as a setup on Jan 17th (click here to view the previous notes if interested in this trade). Since that last post, the $CNDX (TSX Venture Composite Index) did go on to trigger an entry on the trade by clearing the 980 resistance level. From there, the exchange gained about 7% before coming back in to make a successful backtest of the 980 level (resistance, once broken, becomes support). All-in-all, the price action on the $CNDX remains constructive and with prices still trading above but close to that 980 support level, still offers an objective entry or add-on for a long-term trade or investment in the XVX.TO.  To reiterate, my preference is to use the $CNDX chart for timing entries & exits in the XVX.TO. Updated daily charts below.

$CDNX daily April 3rd

$CDNX daily April 3rd

XVX.TO daily April 3rd

XVX.TO daily April 3rd

 

Apr 032014
 

EVR (Evercore Partners Inc) will be added as both a Short Setup and an Active Short Trade around current levels (trading at 54.89 now) or as high as any backtest of the uptrend line. EVR is bear-flagging here shortly after breaking below the primary uptrend line. T2 at 44.55 is my preferred swing target at this time. An alternative entry with a higher probably for the trade to pan out, albeit a less favorable entry price would be to wait for a solid break below the bear flag pattern. Stops should be dependent on one’s entry price, ideally using an R/R of 3:1 or better.

EVR daily April 3rd

EVR daily April 3rd

Apr 032014
 

The SPY/$SPX has been stronger than the $NDX on this most recent move up with the short-term downtrend that was in place since the March 7th high called into question. I still favor additional downside from here (primary) with the possibility of a marginal new high before prices turn back down (alternative scenario).

SPY 120 Minute April 3rd

SPY 120 Minute April 3rd

 

As of now, the short-term downtrend of the QQQ/$NDX remains solidly intact while a break above the March 19th reaction high would end of the series of lower highs and lower lows (downtrend) that have been in place for the last 4 weeks. Additional near-term downside targets have been added to this updated 120-minute chart.

QQQ 120 minute April 3rd

QQQ 120 minute April 3rd

Apr 032014
 

I’ll be watching AAPL (Apple Inc.) closely over the next few trading sessions as the price of this market leading stock is quickly closing in on the apex of this symmetrical triangle pattern. The downtrend line of that pattern is generated off of the Dec 5th peak in AAPL which came just two trading sessions before the AAPL Looking Increasingly Bearish  post in which a detailed case was made for a correction in Apple. From that Dec 5th peak, AAPL fell about 13% (same percentage drop as the previous overbought cluster that was highlighted in that post).

AAPL daily April 3rd

AAPL daily April 3rd

Since the Dec 5th peak, AAPL has been trading in a contracting price range, i.e.- a symmetrical triangle pattern. Such patterns often prove to be continuation patterns with the stock breaking out in the direction of the previous trend. However, triangle patterns can break either way and it’s also not uncommon to see an initial “fake-out”, with prices breaking in one direction only to reverse and continue moving in the opposite direction shortly thereafter. Personally I have no interest in taking a position in AAPL regardless of which way prices move from here but as the world’s largest publicly traded company & the largest weighted component of both the S&P 500 and Nasdaq 100 Indices, it would be prudent to keep eye on the stock over the next few weeks.

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