4 Stocks I’m Watching Closely On Monday
Welcome to Monday morning! Over the
weekend, I had the privilege of attending a summit meeting of a group consisting
of many of the world’s top minds in market analytics, trading, and macroeconomic
theory in New York City. The discussions were wide ranging, from the impact of
future terrorism on the markets to bid/ask micro structure. Talk about a
stimulating great time! Here’s my strategy for today:
The DJIA
My system went short the DJIA on Friday. It took two entries to catch the
wave at the breaking of the lower channel line of 10597. The first entry was
quickly stopped out as the Dow flipped back into the channel, the second entry
at the lower channel line is currently profitable and I am holding into Monday’s
open. Short
Oil
My Texas tea / black gold trade remains underwater. The final fifteen
minutes of trade Friday spiked up about 50 cents causing the shorts to be
negative by 62 cents. Over the weekend, while discussing this trade, I heard
“why are you bucking the trend” and ” don’t you know so and so at XYZ firm is
predicting $80.00 plus oil soon?” As far as bucking the trend, it’s my
contention that the vast majority of the commodity trading public, by default,
are trend followers–hence they buy at the top and sell at the bottom.
Presently, the public bullishness is at unprecedented levels and the market can
only survive by tricking most traders into extreme bullishness at exactly the
wrong time. I answered the so-called famous analysts being bullish comments by
stating that even though these analysts often have better quality information
than the rest of us, being people, they are still highly influenced by their
firm’s positions and the general sentiment of the times. I take their
prognostications very lightly, never allowing their undue influence to effect my
decision making. On the plus side for my oil shorts, I learned of the pending
new Kazakhstan oil pipeline network. Total oil reserves in Kazakhstan are
estimated to be at 5.4 billion barrels and the new pipeline project (if
completed) will be a major shot in the arm for worldwide oil supplies. However,
there are many issues plaguing this project. We will see what happens! Short
The Dollar
Presently the EUR/USD pair is oscillating at 1.2334 maintaining about 100
pips of profit on our long entry at 1.2233. My bullish outlook for the pair
and bearish current view on the dollar remains intact. Long EUR/USD, Short
Dollar
US Equities—My watch and active trade
log
GOOG: Yes ! My short entry last week at 298.10 became profitable on
friday with GOOG closing down 5.38 points at 292.35. I can not stress enough
how this stock gives me end of the internet boom flashbacks. I am maintaining my
strong bearish bias on this one. Remember, GOOG is extremely volatile, trade
with safe size in case our analysis is wrong. Short
GM: This one is still not performing as expected. I am giving it
untill friday to react before replacing it on this list. Flat
BOOM: After capturing a nice move last week and going flat, Boom has
been slowly giving back some of the advance. I am staying flat here until the
next impetus to enter. Stay tuned, this is a fun one! Flat
DNA: The long position continues to move against me at this time. I
am going it give it a little more time to play out before closing. Long
See you Tuesday!
Best wishes in the markets!
Dave G
David S. Goodboy (marketsurfer) has been trading professionally for over
14 years. Mr. Goodboy trades ETF’s, stocks, index futures, energy futures and
options. His primary focus is a unique multi-time frame index trading system
based on a combination of time/price cyclical studies and statistical models.
David was a trader/partner with Biltmore Capital, traded with an option
arbitrage firm, and is currently in the launch stages of IntrendX, a global
multi-strategy fund.