The dailystockreport 2012-05-31_thursday_morningz


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The dailystockreport 2012-05-31_thursday_morningz

  1. 1. Daily Stock Report Thursday Morning, May 31, 2012 Announcement: The Trading Room is a LIVE real-time forum where you get excellent stock ideas for mostly intraday scalping trades where our goal is to make 1-3% profit per transaction. Go to and click on the Trading Room tab for instructions to receive a $1 trial for a week. Not only will you receive excellent stock trading ideas, mostly focused on intraday scalps, you will get commentary about the timing, trading action, and market behavior during the day and how it affects any stock ideas posted in the Trading Room. Plus you will interact with other traders as well. It is highly recommended to study the trading strategies and chart setup before you use your actual hard earned money and practice in a virtual account for 30-90 days before in order to get a high winning rate while practice. This will dramatically increase your chances of being profitable from the beginning of using your own money. See you in the Trading Room!Wednesday’s trading action in US stocks erased all of Tuesday’sgains and puts us at a dangerous point where stocks could easilybreak below these support levels and move lower. All the new stock Summary Opinionideas posted on yesterday’s report was assuming that stocks would Wednesday’s selling erased Tuesday’s gains and puts our longfollow through on the upside with higher prices and in normal positions at a dangerous position and going lower will go belowconditions, stocks would have moved up. But we are far from a recent support levels. Have stop losses set that sell belownormal situation. recent lows OR be prepared for lower stock prices. It is best practices to sell on new lows.The uncertainty in Europe is overwhelming the market and the fearfactor is still building. There was no specific news on Wednesdaythat accounts for Wednesday’s drop but the markets tend to adjust Calendar (All Eastern times)to a potential event or outcome by selling or buying and that’s what I Tuesday, 900am, Case-Shiller 20 City Housing Index, -2.8%think is happening. We did get a drop in pending home sales by Tuesday, 1000am, Consumer Confidence, 69.05.5% when the expectations were to have a gain of 0.1%. Home Wednesday, 7:00am, MBA Mortgage Index, 3.8%sales usually aren’t important enough to cause selling in the markets Wednesday, 1000am, Pending Home Sales, -1.0%unless it is an unusually nervous market, which is what we have Thursday, 7:30am, Challenger Job cuts, 11.2% Thursday, 8:15am, ADP Employment Changenow. Thursday, 830am, Continuing Unemployment Claims, 3.265K Thursday, 830am, GDP, 1.9%I don’t see any clean way the market forces are going to get Thursday, 945am, Chicago PMI, 57.5resolved quickly from the following factors: Thursday, 1100am, Crude Oil Inventories, 0.883M 1. Greece, Spain and Italy situation Friday, 830am, Nonfarm Payrolls, 155k 2. European recession Friday, 830am Unemployment rate, 8.1% Friday, 830am, Hourly Earnings, Avg Workweek, Personal Income, 3. China’s softening of economy, hard landing? Personal Spending, Core PCE Prices, 4. US economic data Friday, 1000am, ISM Index, 54.0 (above 50 is expanding) 5. US Presidential election Friday 200pm, Auto and Truck sales 6. Apathy in retail investors 7. Housing recovery Follow-up notes: CS, Credit Suisse. Cancel this idea, too weak compared to other ideas.We also have employment data coming out on Thursday morning Previous report:with Unemployment claims, GDP (Gross Domestic Product) GIL, Gildan Activewear. This just isn’t rebounded, CANCEL.followed by Friday’s big numbers of the Nonfarm Payrolls forecasted LEAP, Leap Wireless. CANCEL idea or 155,000 new jobs. The Unemployment rate is expected to be at This is acting poorly for new position.8.1%. With the market being as nervous as it is, any numbers APKT, Acme Packet. Consider small long for 2-3 day hold time. Setworse than expectations will take the market down further so it is stop loss under $22.50.important that you keep stop losses on your long positions. As NYX, NYSE EuroNext is acting poorly for long position, CANCELalways, don’t be leveraged on any one stock, sector or direction of or sell.the market. Short positions continue to outperform the longs. ANR, Alpha Natural Resources. LPSN, Liveperson is acting too strong for short; cover shortREPEAT: Thursday.It will take a more nimble and proactive investor or trader to profit from these BMY, Bristol-Myers Squibb. Should be stopped with Wednesday’s lowershort term rallies and it also takes more courage to open short positions to low.get on the downtrend for the average investor. The key is to start smallerthan normal positions and gradually open positions, not all at once.The mindset you need to have to profit in these conditions is to consider using both long and short positions and remain prepared for times such as thisweek. We still should see a rebound coming for a few days and be content with lower profit gains with shorter holding periods. We will see longer holdingtimes as market conditions change from short to longer term. 1
  2. 2. Scalp of the day from Trading Room: (all eastern times) GME, Game Stop, gave a 7% short potential profit. This occurred later in day. These scalps posted here are best ones we find in real-time each day and will do our best to present these as timely as possible to the Trading Room and give commentary and suggestions as how to profit from them. Normally a 2-3% profit is very good per scalp. The Trading Room is now open! Start your $1 trial here: Swing Trade Ideas: (Usually hold time is days) CHMT, Chemtra, Consider small long position. CCE, Coca Cola Enterprises. Consider small long position. CENX, Century Aluminum. Consider small long position. CE, Celanese Chemicals. Consider small long position. NBL, Noble Energy. Consider small long position. HLX, Helix Energy. Consider small long position. BEAV, BE Aerospace. Consider small long position. BK, Bank of New York Mellon. Consider small long position. BG, Bunge Ltd. Consider small long position TTWO, Take Two Intera Software. Consider small long position TRW, TRW Automotive. Consider small long position LVS, Las Vegas Sands, Consider small long position. RDC, Rowan Cos. Consider small long position. SSO, Ultra S&P 500 long etf. Consider small long next 2-3 days. DDM, Ultra Dow30 long etf. Consider small long next 2-3 days. UWM, Ultra Russell 2000 etf. Consider small long next 2-3 days. ORLY, O’Reilly Auto Parts. Consider small long position. UYG, Proshares Ultra Financials. Consider small long position. HUM, Humana. Starting to monitor HUM for potential long position. VCI, Valassis Communications. Watching for short entry next 2-3 days. CME, CME Group. Consider small long position. IDCC, Interdigital. Consider small short. Intermediate Trade Ideas: (weeks to months) MTB, M&T Bank. Consider small long position. TWX, Time Warner. Consider small long position ITUB, Bank Itau. Consider small long position.Focus Chart: (Worden Telechart 2007-Download FREE on home page of EGN, Energen Energy. Consider small long BP, British Petroleum, Consider small long position.ROSG, Rosetta Genomics, corrected today almost 12% and IDCC, Interdigital. Consider adding to short position.has a lot more downside to it. Still not too late to short smaller RL, Ralph Lauren. Consider small long position.position. Finding shares has been difficult to find. Keep small MDVN, Medivation. Consider small long position.position and no leverage. CS, Credit Suisse. Consider small long position. CANCEL, SEE NOTES ABOVE MNST, Monster Beverage. Consider long position. MKC, McCormick & Co. Consider small long position. Aggressive Investors-Traders (High risk, high reward) ROSG, Rosetta Genomics. Consider small bullshort position Friday. This came from $1.42 only 9 days ago to a high of $23.43 today [Thursday]. Start very small and don’t get leveraged early. This is an aggressive strategy for experienced traders on this technique. TNA, Small Cap bull 3X leveraged ETF. Consider small long next 2-3 days Don’t get leveraged on any of these aggressive ideas. Study Bullshorts in the Wizard Training Course before attempting this high risk high reward strategy. It is best to let these peak in price and turn down before opening short. 2
  3. 3. Stock List Type Notes Open Price Close PriceCMG,CMG Chipotle Mex LONG-INT Closed all long position at 405, 236% avg. profit 163.49 367.18MNST, Monster Bev. LONG-SWI still Uptrend still strong in down market. 42.69 53.35DLTR, Dollar Tree LONG-SWI Strong in down market; prepare to sell 1-2 days market; 1- days 97.50 101.58IMGN, Immunogen LONG-SWI Closed Thursday for an 8.6% profit. 12.65 13.65MDVN, Medivation LONG-SWI Uptrend still intact. 77.98CL, Colgate-Palmol LONG-SWI Sold Wednesday for small profit. 98.15 98.82IDCC, Interdigital SHORT- SHORT-SWI RT New low Friday, hold short. 27.31AL, Airlease SHORT- SHORT-SWI Covered short Thursday for 7% profit. 22.25 20.78FCS, Fairchild Short- Short-SWI Covered short Tuesday for 3% loss. 13.37 13.62SSO, Ultra S&P 500 LONG- LONG-ETF Critical that price levels don’t drop much 49.66DDM, Ultra Dow30 LONG- LONG-ETF Critical that price levels don’t drop much 62.43UWM, Russell 2000 LONG- LONG-ETF Critical that price levels don’t drop much 35.65ORLY, O’Reilly Auto LONG- LONG-SWI Sold Tuesday for 3% profit. 93.59 96.80UYG, Ultra Financial LONG- LONG-SWI Critical that price levels don’t drop much 49.66HSC, Harsco LONG- LONG-SWI Sold Wednesday for 7% profit. 19.05 20.40TNA, Small Cap 3x LONG- LONG-SWI Critical that price levels don’t drop much 45.50HLF, Herbalife LONG- LONG-SWI Small long position, only 2-5 days hold time. 45.00 45.00AAP, Advanced Auto LONG- LONG-SWI Sold Wednesday for 9.5% profit. 66.95 73.40COP, ConocoPhillps LONG- LONG-SWI Sold Wednesday for 4% profit. 50.85 52.69ARG, Airgas LONG-SWI Sold Friday for 6.5% profit. 83.35 88.79TSS, Total Systems LONG- LONG-INT Sold Wednesday for 4.5% profit. 22.65 23.50WLP, Wellpoint LONG- LONG-SWI 1- Consider selling next 1-3 days. 66.92HUM, Humana LONG-SWI LONG- Weakest of the healthcare: AET, UNH, WLP, CI 77.12MAC, Macerish LONG-SWI LONG- Sold Wednesday for small profit. profit. 57.35 57.75MO, Altria LONG- LONG-INT Small long position 31.82IRF,IRF Int’l Rectifier LONG- LONG-SWI Small long position. 18.66TLM, Talisman LONG- LONG-SWI Small long position. 10.54LVS,LVS Las Vegas Sand LONG- LONG-SWI Small long position. 48.56RDC, Rowan Cos. LONG- LONG-SWI Small long position. 32.12RBC, Regal-Beloit LONG- LONG-SWI Small long position. 61.24CME, CME Group LONG- LONG-SWI Small long position. 264.55ITUB, Banco Itau LONG- LONG-SWI Small long position. 14.38Here are some highlights of comments and stock ideas from Friday LIVE Trading Room. Try a $1 trial for 1 week using thislink: 3
  4. 4. SWI (SWING): 2-7 days INT: Intermediate term position 8 days to several months. Open Price: price paid on opening longposition or price sold on short position. Bold notes on table above represent changes from previous day.Current positions are highlighted in yellow. Green colored lines are next probable positions to consider. Red, take action orwatch closely, no color usually were stocks just finished trading or are watching. Realize that opinions about stock ideascan be changed at a moment’s notice during any trading day without any warning!IMPORTANT: The notes in this stock list is how I have been writing notes to myself about stocks for 17 years. They are generalguidelines as to how I am approaching a particular stock and conditions may change during the next trading day that ay cause a changein opinion before the next evening report is written.Remember not to get too heavy in one sector and gradually move in because it is unrealistic to think we get the exact bottom. We wantto gradually move into this sector and eventually build full size long positions in them that may be swing trades lasting for days orintermediate trades lasting weeks.If you spend too much money too quickly, you will run out of ammunition, then get emotionally stressed when stocks are going againstyou. If you get too leveraged you may be forced to sell at a loss because you are racking up losses at twice as fast if you are margined 2to 1and then miss the big move up we are looking for in oil and gas stocks.Advice: Don’t get leveraged in any one position long or short. Spread your money out between a variety of stocks and the higheramount of money you are working with, the smaller percentage of money you can afford to trade in one stock position. The main reasonswhy people fail to make money in stocks consistently (according to Mitch King): 1. They are too emotional, controlled by greed and fear. 2. Not using a high probability technique to buy and sell (or no technique at all!) 3. Position size is too big in one stock relative to total account value (which is related to #1 above).Not patient or willing to spend enough time to learn a good trading technique. 4. Expectations are unrealistic to make large amounts of money in a short time period and at the same time violating #1, 2, 3 or 4 above.Thoughts: Best odds only, be decisive, aggressive, mentally flexible, stay in position size, don’t overtrade and wait a little longer to buyand wait a little longer to sell. You will find that will make you more money on your trades. Trade what you see, not what you hope for.Intermediate and swing trades are really important to have trailing stop losses set.Don’t trade unless the setup is there for you, then use the charts to tell you when the odds are heavily in your favor. Don’t force anythingto work for you, let the setups develop and then take advantage of that. Be patient. Stay in position sizes without letting any intradaytrade represent no more than 10-15% of your total account value. As you build your account, your position size percentage should getsmaller and smaller to lower your risk.Stop losses: Many people ask about stop losses on intraday trading and my response is that the stops should be wider because they arestops “just in case” a disaster news event hits the stock. When you follow the technical indicators as I show you on the intraday scalpingtutorials, rarely will a stop loss be hit. The indicators can be used with uncanny accuracy as a forecasting tool so don’t set your stoplosses on the intraday scalping too tight.Anyone setting tight stops while scalping will consistently lose money on scalping because stocks move around a lot even though theyfollow the technical indicators.Stop losses on swing and intermediate term trades can be sent anywhere from 5-7-10% and trailing stop losses are best.More thoughts: Keep steady, calm, decisive, aggressive. Have no fear and no greed. Keep looking at what to be doing next in a calmmanner. Don’t focus on the past or beat yourself up what you did or didn’t do or what you should have done. Just keep playing the nextshot, which in this business your next shot could be just sitting on the sideline.If you have been uncomfortable shorting stocks, which most people are, try to learn this technique, it will be a useful tool in the comingyears.When several stocks from the same sector are listed, like from the housing industry or steel industry for example, don’t short all of themunless you are well diversified and it represents a small percentage of your total stock account (in that same account).Also note that we are in what Martin Pring, PhD explains in his book The All-Season Investor, the business cycles and which one is goodfor various financial investments. He would describe that we are in Stage II of the business cycle which is positive for bonds and stocksbut negative for commodities. Sometime in late 2011, we probably approach Stage 3 business cycle with rising inflation and interestrates, which are usually bad for stocks and bonds.A couple of technical analysis books you should consider:Technical Analysis Explained, Martin Pring.Technical Analysis from A to Z, AchelisTechnical Analysis for the Financial Markets, John Murphy.Put the odds in your favor and have a great day!Mitch King and online stock trading, trading strategies, stock picks, stock market education, stock market investing course, educational stocktrading videos, stock trading newsletter, stock market newsletter, 4
  5. 5. Mitch King is the founder of All material presented herein is believed to be reliable but we cannot attest to itsaccuracy. All material represents the opinions of Mitch King. Investment recommendations may change without notice and readers areurged to check with their investment counselors before making any investment decisions. Opinions expressed in these reports maychange without prior notice. Mitch King and/or the staff at may or may not have investments in any stocks citedabove before or after this newsletter is prepared. Use the stock table above as a model portfolio of ideas that look attractive at the time ofthe writing. Comments can be hypothetical in nature. Opinions expressed in these reports may change without prior notice. Disclaimer -Stock investing or stock trading has large potential rewards, but also large potential risk. There is risk of loss as well as the opportunity forgain when buying or selling stocks, bonds, option contracts or engaging in any strategy listed in the Daily Stock Report, The WizardTraining Course, The Trading Room and our seminar or workshops. You must be aware of the risks and be willing to accept the riskswhen investing or trading in any financial markets. Dont trade with money you cant afford to lose. This website is neither a solicitationnor an offer to Buy/Sell stocks. No representation is being made that any account will or is likely to achieve profits or losses similar tothose discussed on this website. The past performance of any trading system or methodology is not necessarily indicative of futureresults. 5