Wolf on Wall Street

Wednesday, March 10, 2010

A few shorts

Here are a couple of shorts from this week's list that are looking pretty god now, I'll be back with more later.

FRZ
ELGX

Both short-here and now seems to be fine. Read the notes with the stops attached in this week's Spreadsheet.

Back to Patience

**For whatever reason, this did not get posted last night

Last week I posted several shorts, you'll want to take a look at those. Any of the long trades from this week can be held with the stops in place assuming you did not treat them as anything other then speculative positions, a few more should pop, but I feel we will see a reversal very soon. We want to wait for confirmation so as I occasionally post, right now is the time to use the one edge you have over Wall Street, patience.

If we get it tomorrow, I'll post an intraday update with the trades that are best positioned for the move.

Tuesday, March 9, 2010

Something is Amiss

Take a look at the latest post at www.Trade-Guild.net

Also something is wrong with the spreadsheet's P/L calculations, we're working on it now.

Trades for the 9th are up

As you can see, the cats and dogs are getting VERY speculative-hit and run, 1-2 day gainers. Keep the trade size appropriate to the risk, meaning small. The trades that didn't hit from yesterday and those I mentioned intraday today are all still in play.

If you have questions email me, but this is a sign that the end of the rally is just about here when they start to get this speculative.

Good luck-RISK MANAGEMENT!!!!!

Monday, March 8, 2010

From Last Night's List

If you haven't bought anything or shorted, here are a few that are looking interesting

*CAEI L
*CNTF S
*CYPB L
*TRMA L
*VITA L the pullback right now has created a lower risk trade if you haven't bought it
*ELGX S is in a great position in the bear flag right now
*RZ L looks interesting, like it may move
* CPSL L is up already over 12%-you may want to watch it to take some profits, depending on what the market does or how big your position is
* JADE L same as above-it's been up over 6% already this am

See the SpreadSheet for notes

Sunday, March 7, 2010

TRADES FOR MARCH 8TH

THERE ARE A LOT OF "CATS AND DOGS LONGS HERE, BUT THE TEND TO MOVE QUICKLY FOR 1-3 DAY GAINS THAT ARE SIGNIFICANT. I HAVE PLENTY OF SHORTS, BUT UNTIL WE SEE OUR TURN AROUND WHICH I THINK WE'LL SEE SOON, WE'LL TAKE WHAT WE CAN GET AND THE CATS AND DOGGS ARE USUALLY A SIGN OF THE END OF THE UPTREND-TAKE THEM WHILE YOU CAN

Saturday, March 6, 2010

Reading Time

If you haven't seen it yet, I posted an article on Trade-Guild "Is a Kiss More then a Kiss?"

I suggest reading it and several of the articles below to get a feel for the market. We are extremely overbought, but that means next to nothing as overbought can go on for a long time. There are however, several reliable indications that suggest we are close to the end of the uptrend. That is why this article is important to read, it lays out a couple of scenarios that you need to be prepared for.

I do not, have not and do not expect to see anything bullish that will change the primary downtrend we are still locked in so long trades are strangely counter trend if that makes any sense. I'll be posting more there, some sector opportunities and you'll see those stocks here, but you should understand the basics behind the sector and why the trades will be showing up here.

This is a difficult time as the market heads higher and all the indications are showing the equivalent of a Ginger Bread House. However, there are a few people that have been at this a lot longer then I, like since the 1950's, writing indicators for Wall Street Firms and have seen a lot more then I and I feel confident that their assessment is largely the same as mine.

The market is dubious and deceptive and you must question everything you see and hear from Wall Street and CNBC-especially Cramer (who single handedly took out one of the most reliable technical formations over the last 100 years in a single night-AAPL). I'd be watching for distribution in that stock over the next month.

If you find you are having trouble in the market now, always feel free to email me or go to Trade-Guild and read everything under "Resources and Concepts" and make sure you are on the same page. We can be wrong a lot of times and still make money, or without management we can be wrong a lot of times and lose everything.

Trades will be up Sunday

Thursday, March 4, 2010

TRADES FOR MARCH 4TH ARE POSTED

I Highly recommend reading the last 3-4 posts at www.Trade-Guild.net , especially the last one tonight.

There may be a great opportunity tomorrow to finally break this stalemate in the market the last 3 days.

Take a look at tonight's trades, I like them all especially the longs, but remember, under $5 is speculative and you need to use appropriate measures in your risk management.

Keep a special eye on GS, GOOG and AAPl for opportunities (a couple of possible false breakouts that could move down rapidly)-most have been on the lost the last few days so be sure to review the notes and email me with any questions.

Good luck!

NEW TRADES ARE UP

The short sale trades are fine as is, they can be taken at market open at market, the long trades a little more speculative so keep the risk lower, maybe 1% or so.

Good luck-we should see a reversal in the next day or so.

Wednesday, March 3, 2010

FAZ

FAZ (3x leveraged short on financials ETF) is looking strong here with a tweezers bottom reversal, it also has fairly low risk in this area, just be careful of market correlation -for example if you already have a short on GS or JPM, FAZ would be a bit redundant and you wouldn't want 50% of your portfolio all in financials.

3C Quick Start

Many of the charts you see here at WOWS are my proprietary indicator 3C which reveals underlying institutional money movements and often contradicts price. To understand the annotations made on charts, you must first understand that 3C has no numerical value, it is a pure divergence indicator. Positive divergences represent accumulation by smart money, negative divergences represent distribution by smart money and when 3C trades with price, that is trend confirmation.

The chart annotation system is simple; white arrows represent relative positive divergences, red arrows represent relative negative divergences and green arrows represent trend confirmation. When 3C is in a white or red box, that represents a leading positive or negative divergence, leading divergences are the most powerful.

We analyse 3C in multiple timeframes, the longer the timeframe the stronger the accumulation. 1-2 min timeframes represent intraday moves, a 5 min timeframe can represent a day or two and 15 min timeframes average trends of a swing trade nature. 30 and 60 min charts can move the market for a month or more and daily charts can be over a year.

You'll get use to seeing the charts and understanding how the multiple timeframe analysis works and works well.

Welcome to Wolf on Wall Street.

The trades featured here are meant to maximize returns with the least risk and highest probabilities. Unless otherwise mentioned, all trades are meant to be executed at market. I prefer long-term trending trades which perform well in rising markets, but really stand out in declining markets. However, we get occasional one day gifts 30,40,60% 1-day gains. I'd urge you to consider taking some or all off the table in such cases, the markets don't give gifts like that often or for very long. Most of the returns that make the system outperform so well come in short-entry trades. If you are opposed to short trades, this is not the system for you, unless you are ok with buying an inverse ETF. If you would like more information about the truth about shorting stocks, just email me.

Risk management. I recommend a specific and consistent risk management approach to all positions. In most cases we try for 2% risk money (2% of portfolio) unless such a position size exceeds 15-20% of overall portfolio in actual position size. Each trader is different and each has a different allowance of open trades. I like to keep the overall money in the trade around 10-15% of portfolio per position in case of gaps against you. Stops are generally executed at the end of day and I personally never place a stop order, all my stops are mental; remember, the middle man gets to see everyone's cards. When you are not in tune with the market or opportunities just aren't that spectacular, I take my risk per position down to 1% or even half a percent of portfolio value.

Each trader is different and must determine their own level of comfort with risk. I do have a channel stop which I provide to TeleChart/StockFinder users for automated stops, I appreciate you using my links to sign up if you do. The Trend Channel catches trends and works well as it automatically adjusts for each stock's volatility. Arbitrary exits based on nervousness about the markets WILL decrease the portfolio performance dramatically. This system will not ever get you in at market bottoms or tops. The recent 1 year performance against the Russell 2k buy and hold had the system beating it by 3:1. Ultimately it is up to you as to how you proceed, but I'm always available to help you determine what might work best for you.

I do use other scans and systems when market conditions warrant their use and may change strategy with market conditions.

The MOST IMPORTANT tool you have to bring you long term success is RISK MANAGEMENT. There are plenty of articles linked at Trade-Guild.net on Risk Management. We can be wrong 75% of the time and still outperform the market with solid, consistent risk management.

Position Sizing

The position sizes noted in the positions @ 2% risk of portfolio are based on a $20,000 portfolio-adjust as needed. Due to tight stops, there is the possibility, even probability that one position could take up the entire portfolio. You need to decide how many positions you want to trade and reduce the position size according to that. For instance, if you want to trade 5 positions in a $20,000 portfolio, no one position should be valued at more than $4,000-not risk money or 2% rule, but share price entry x shares.