Four Stocks I’m Trading…
As the trading
range continues, selectivity and patience is
becoming even more paramount. You cannot trade your way to profitability in a
trading range. However, like yesterday, even sensible well thought out trades
fall victim to the gyrations of a trading range.
I took five trades, all within the first couple
of hours, only one panned out, and even at that it was not a real big winner.Â
No big deal, you cannot win everyday, however, the horizontal movement increases
the odds of having a day like yesterday. Nonetheless, I have no intention of
changing my game plan today. One losing day after many consecutive winning days
simply is a function of statistics and the bell curve (remember stats from
college, I know it was your favorite class, ironically it was mine though.)Â
I have also been asked what stocks I am trading
lately. Below is a list of the ones I have found conducive to trading off the
5-minute chart:
Goldman Sachs
(
GS |
Quote |
Chart |
News |
PowerRating)
Newmont Mining
(
NEM |
Quote |
Chart |
News |
PowerRating)
EMC
(
EMC |
Quote |
Chart |
News |
PowerRating)
Amgen
(
AMGN |
Quote |
Chart |
News |
PowerRating)
Perhaps the economic numbers due out later this
week will finally allow the market to move out of this range, regardless, if you
are patient, you can always find a few opportunities each day. For instance,
this morning, Goldman Sachs (the firm) has downgraded retail stocks, this may
offer a great opportunity for a Fade The Gap
trade on shares like, HD,
KSS and WMT.Â
After that, forget about them, too much fundamental news, and that usually makes
trading them from a technical perspective a bit dicey.
As mentioned yesterday, keep an eye on the Dollar
(DXC) as it may have an inverse relationship with gold stocks. In fact, if you
look at the weekly chart of DXC, you will
notice that a break of the recent up-trend channel will occur below 96.70, that
may invite more selling. Ironically, bonds have been a beneficiary of a lower
dollar, as central banks appear to step in and buy Treasuries in order to
support the dollar. Gold, as we know, has been on a good run and looks a bit
extended. However, a pull-back in the dollar may put a nice bid in the gold
mining shares intra-day. My personal favorite is
Newmont (NEM). When it is in “play” it has excellent range and
decent liquidity.
Bottom line, it is quiet and until the pot gets
stirred up a bit, I have no magic panacea. Keep it light and be selective. In
the meantime, the long Euro (EUR) position is playing out, albeit slowly. I am
trailing my stop up in order to protect profits.
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As always, feel free to send me your comments and
questions.
Dave Floyd