Tuesday, September 14, 2004
Issue Contents:
| 09:01 | The Day Ahead Economic releases and news. |
| 09:31 | Swing Trade Setups From Monday September 13 scans. |
| 15:50 | Zzz What inside days are made of. |
| 16:15 | TrendVue Trader Talk Today's transcript. |
| 19:58 | Stock Scanner Results For Tuesday September 14. |
Good morning. On news of a record current trade account gap1, coming in as a surprise to observers, the US dollar is marginally under pressure but at key levels, compared to a number of other currencies. We’ll want to keep a close eye on currencies (and gold and oil it seems) this week.
US Market Calendar
- 7:45 am: ICSC-UBS Store Sales
- 8:30 am: Current Account
- 8:30 am: Retail Sales
- 8:55 am: Redbook
- 1:00 pm: 4-Week Bill Auction
Canadian Market Calendar
- 8:30 am: New Motor Vehicle Sales – July
- Manpower Survey – Q4
Earnings and the Federal Reserve
For earnings highlights, please see today's WSJ Earnings Calendar.
For a list of upcoming speeches, congressional testimony, Federal Open Market Committee material, and statistical releases, please visit the What's Next page of The Federal Reserve Board website. Recently released Federal Reserve Board material, including market moving FOMC decisions and speeches by members, will be found on their What's New page.
1 U.S. Current Account Gap Grows to Record
2 U.S. Retail Sales Slip on Auto Weakness
Featured setups from Monday September 13 closing data symbol scan
Jump to: Long Setups | Short Setups
Notes for the Day
While daily and weekly charts continue to point up, in the absence of a test of a recent swing high or important top nearby, we have to give the market the benefit of doubt and keep the upward bias. That doesn’t mean that the market has to go up each day, in order to remain in an up-trend.
We can see that down swings have been short and sweet as of late, another signal of a market with buying support behind it. Ironically, tightening swings is also an indication of a wedge-like consolidation zone.
I want to point out the potential for a rising wedge here as well, which, if broken, has an ultimate target of the August lows. We should use such patterns not to prevent action but to keep everything in context. For now, the bias remains up – and if a down day (or more) should arrive, our first task will be to locate new long opportunities to exploit when such a retracment ends.
More stock picks will be discussed in the first hour of TrendVue Trader Talk.
Long Setups
General common strategy: Unless noted otherwise, buy stop just above the “high” value, with an initial protective stop at the low value of the bar, not below the bar.
Retracement or Pause in Up Swing / Up Trend
AAPL – bull flag near significant multi-year high. Buy stop 36.08, protective stop if filled 35.32.
Test of Top – Continuation
APA – was part of a basket of energy picks last week that all had good moves out of the gate. I let stops take me out of an APA trade – since this company has exposure to the Gulf of Mexico and therefore Hurricane Ivan I am unlikely to trade this long (or short) at this time, but wanted to bring it to our client’s attention—if you remain long APA, should a “breakout” of the range occur here it may be a good time to take profits.
Short Setups
General common strategy: Unless noted otherwise, place a sell alert at or just below the low of the setup bar, and look for the first failed intraday bounce after the low has been broken. What we are looking for is price to push down, bounce a little, and fail again – this is where we want to get short.
Retracement or Pause in Down Swing / Down Trend
MWV – single up bar after a break of the rising wedge. Typical ultimate target for a broken wedge is drawn out; regular readers know that we do not “forecast” but will use price extension based on classic interpretation of consolidation zones as a guide to potential.
Test of Bottom – Continuation
CCE – things go better with Coke – single up bar at a test of bottom offers aggressive traders a short opportunity. Place alert at Monday’s low and, if triggered, locate an intraday entry point off a failed minor bounce.
What a dull day – it had “inside day” written all over it this morning, as a trianglular pattern just got bigger and bigger. This is a classic “profit taking day”, near as we can determine – a minor uptick in the number of declining stocks yet volume for the day remains marginally in favour of advancers.
While this makes for tedious intraday trading, the price action is constructive for swing traders as we should find a number of “outlier” stocks – symbols which put in a down day today, yet remain in an upswing on the daily charts. These can be good candidates for new long side swing trades.
In the meantime, when price action slows we do other work and save our powder for another day.
Today's transcript.
Click on the title above to expand this document.
For Tuesday September 14.
Click on the title above to expand this document.