Spike's Scientific Stock Analysis

[spikefader]

Stopped out even on the 10811 add for a push.
Just re-added at 10823.

[skiracer]

I was going in a very bearish mindset a couple of weeks back an apparently was way off base. It really doesn't matter as long as you can switch tracks and get on the right side of the momentum before you miss the boat and the ensuing opportunities to the long side. I guess that's the main difference in trading what you see and not what you think. Anyway as we all know things can change overnight due to any number of factors. Being on the right side of the momentum and trend regardless of which direction it's going is the only significant approach to all of this.

[Runner]

I was going in a very bearish mindset a couple of weeks back an apparently was way off base. It really doesn't matter as long as you can switch tracks and get on the right side of the momentum before you miss the boat and the ensuing opportunities to the long side. I guess that's the main difference in trading what you see and not what you think. Anyway as we all know things can change overnight due to any number of factors. Being on the right side of the momentum and trend regardless of which direction it's going is the only significant approach to all of this.

Very well said!

[spikefader]

SCOTC Cream of the Crop.

Performing well. GYI, ARS, GOOG, CHS, AET, MCO all perform well today. DJO was eliminated on psar rule at open at 31.00 for +1.6%, -1%(x2). GOL disappoints and gets eliminated, stopping out of all three positions for -5.8% (x2) and -4%. Don't have time to look for entries today, so distributed the 6 eliminated positions across the board as the others stopped out.

[dmk112]

Not taking any sides here but a general rule of thumb is that the more times a market bangs against resistance (a trendline like you have presented) the better the chances are that it will break that trendline.

Good point.

Yes that is true, but when do you know when it will? You don't. So I think you sell at that trend line everytime it touches it and if it does break then you can always get back in.

[dmk112]

Well now you're stretchin' it dude. It WAS resistance! Until it was broken!

LOL. Let's comprimise. The resistance is on the verge of being broken. OK?

I think it has to pop up a bit more for it to be broken. If you make that line thicker that pop through the line is not there...hehe

[skiracer]

Good point.

Yes that is true, but when do you know when it will? You don't. So I think you sell at that trend line everytime it touches it and if it does break then you can always get back in.

You never know it will break resistance or support until it actually does, but when indicators looks strong, very strong, or visa versa it's a fair indication that the move will be in that direction. But being from Missouri, not really, but as Harry said, " you have to show me for me to believe it", I like to wait until I see it. In the interim if a market has been moving steadily upward for two/three weeks like what we have had recently it would be a shame to miss out on some of the opportunities over that period of time. Reality presents itself to anyone who wants to accept it for what it is. In any given situation you can only lose as much as where you place your stops.

[spikefader]

LOL. Let's comprimise. The resistance is on the verge of being broken. OK?

I think it has to pop up a bit more for it to be broken. If you make that line thicker that pop through the line is not there...hehe

I'll tell ya what, it's an interesting subject the concept of line thickness. Not sure I'm prepared to compromise on whether it's broken. That's a big compromise you're asking for there. I want to compromise...just not sure it's wise to. I've got my lines in the sand ya know?

I'm going to open the floor for anyone willing to post on whether they think it's broken or not.

In my view it's broken. A line is a line. A thick line merely hides the truth. How thick do you make the line? Well I have made a thick line or two in the past, mainly for pattern recognition. Some people need closing values for trendline breaks. I don't. I just need to see the break. Then it's either a successful or failed break. I say COMPX has broken it, and the success or failure of the break is yet to be seen. Price may drop like a rock from here for all I know. But the line broke and it would be a failed breakout AKA headfake break.

So how about it folks?? Is it broken or not?

[New-born baby]

It's broke.

I'll tell ya what, it's an interesting subject the concept of line thickness. Not sure I'm prepared to compromise on whether it's broken. That's a big compromise you're asking for there. I want to compromise...just not sure it's wise to. I've got my lines in the sand ya know?

I'm going to open the floor for anyone willing to post on whether they think it's broken or not.

In my view it's broken. A line is a line. A thick line merely hides the truth. How thick do you make the line? Well I have made a thick line or two in the past, mainly for pattern recognition. Some people need closing values for trendline breaks. I don't. I just need to see the break. Then it's either a successful or failed break. I say COMPX has broken it, and the success or failure of the break is yet to be seen. Price may drop like a rock from here for all I know. But the line broke and it would be a failed breakout AKA headfake break.

So how about it folks?? Is it broken or not?

It's broke.

[billyjoe]

Spike,
Another good thing about these semi-mechanical portfolios with stops, when you start with a number of stocks that slowly or quickly is whittled down there's no time to "fall in love" with a stock. You just "love" what's standing at the end of the day.

billyjoe

[dmk112]

I'll tell ya what, it's an interesting subject the concept of line thickness. Not sure I'm prepared to compromise on whether it's broken. That's a big compromise you're asking for there. I want to compromise...just not sure it's wise to. I've got my lines in the sand ya know?

I'm going to open the floor for anyone willing to post on whether they think it's broken or not.

In my view it's broken. A line is a line. A thick line merely hides the truth. How thick do you make the line? Well I have made a thick line or two in the past, mainly for pattern recognition. Some people need closing values for trendline breaks. I don't. I just need to see the break. Then it's either a successful or failed break. I say COMPX has broken it, and the success or failure of the break is yet to be seen. Price may drop like a rock from here for all I know. But the line broke and it would be a failed breakout AKA headfake break.

So how about it folks?? Is it broken or not?

Spike, just becuase the the price peaks out obove the trendline doesn't mean that it is broken. Yes now it probably is as the NAZ is up 10pts as I type this. But the fact is you were buying and bullishly speaking when it wasn't broken and you were buying the in the face of resistance. That's it, I'm done.

[skiracer]

2250.86 as I type this. Have to say it broke through that trendline. Whether it holds or not is another factor. Have to wait until closing to determine that.

[mystiky]

Latest Cramer Pump - HLEX - running on empty?

Hi Spike,

Congrads on your wonderful calls lately. You are "da BULL"!

Listen, whats going on with HLEX chart?

Cramer pumped last Friday on his TV show, and it certainly got some volume steam going. But up so much? It even printed an all-time high today (intrday).

I am seeing support at around $22... and then the bottom of the gap at $20.
Of course there is a 50-day moving avg at around $21.

What are yuor thoughts? I know a few that shorted around the $23.90 area today, and perhaps should I join on a re-test of this level tommorow?

THANKS again!

[spikefader]

Spike, just becuase the the price peaks out obove the trendline doesn't mean that it is broken. Yes now it probably is as the NAZ is up 10pts as I type this. But the fact is you were buying and bullishly speaking when it wasn't broken and you were buying the in the face of resistance. That's it, I'm done.

Done!?!? haha it's only just beginning! lol I got some thoughts I wanna put down. You make it sound so bad that I was bullish and buying when the indexes have been at resistance. I will have to appeal to the High Court for leniency. lol

OK, yeppers, it appears that I did. Whether you take COMPX resistance or the YM resistance back there I'll admit, without shame, that I added at 10684, and more recently when COMPX was at/around resistance I've been a stalking insane bullish fanatical buyer. Does it count that for the 684 add I bought a good pullback and used a 4 point stop called real-time and didn't get taken out?! haha Does it count that the more recent adds only cost me 20 points and the others were pushes? Does it make a difference that by adding recently to the position (now resistance has been broken) the swing is now up 600 points combined on the 3 contracts, with an average of 10691? Buying near/at resistance ain't that bad after all! hehe There's reason for the madness!!

Now this YM swing really is worth pondering. In the face of clear price resistance on the Dow and/or COMPX I added. Why? Well, simple; price action can sometimes act in such a way that justifies buying. And as long as the r/r is good then it's OK. In the case of the 684 add I used a 4 point stop (that's right a 4 point stop; $20 risk) and that never got taken out. That was a perfect add. Not only because it never got taken out, but because I followed the rules of the system I trade despite how I 'felt' about the potential for success or the resistance that usually smart people sell at.

But does all money sell all resistance all the time? Of course not. And I'm not going to do it every time. And I'm not going to let it stop me from establishing new positions in the face of resistance. If I were to, I'd be letting fear or some other type of useless emotion affect my trading.

See, market bias at the time of every add I've made has clearly been bullish, and despite the resistance, despite the bearish patterns I spotted for me own eyes (like the SHS and neckline break the other day you were short dmk) my system was saying green, long, buy. The fact that the position is open and +600 points is proof that the adds have been and ARE correct and the fact that the system can obviously generate successful very low r/r long setups while at or near resistance is merely hardcore evidence that the system has a lot of substance and merit to it.

But let's not go there, let's just debate on whether a trendline I drew was thick enough to say it's a trendline break! hehe I'm just being facetious there, so disregard that. The thickness of the line IS an important concept worth discussing. And also worth discussing is what makes for a break and what makes for a failed break. In my view, a wick that penetrates and crosses a line is a break. If price fails then it's a failed breakout. The line is a line. Dmk may be from the schooling that you need a closing break over a trendline to call it a break, or it needs to go 'so far' to make it so. But all that is irrelevant to whether one should be trading long or short. Every issue behaves in its own way, and yes, many follow the indexes. But just because an index is at resistance doesn't mean you MUST trim/sell/short. It's a lot more complicated than that.

Look, I'll be the first to agree with you dmk that yes, smart money generally sells resistance. I actually called for opinions about whether I should hold or sell the YM swing as it was approaching 10700, and I was really looking for the system I use to show me that I should exit. Selling resistance is a general principle that I believe in probably more than most. But the signals just didn't appear. They were all green.

I honestly believe that in the right circumstances one should stand back from the automatic thought of selling every resistance and give an open profitable trade the chance to break it. The patterns were bullish, the breakout imminent, the system green-lighting long, so selling resistance didn't apply to me ...... so I imagined thought; and thought thought right on this occasion. You'll recall that in recent times I've had a decent profit in hand only to see it disappear because of the schizoid pathetic bull that we joked about, and you posted that hilarious pic of the scared bull in the rollercoaster. haha But a trend is what I was looking for, and I risked that profit (and lost it) while looking for the trend and the bigger move. And that's what we have now, a trending bull. I successfully got on board early and I'm being rewarded for it. That bullishness is in the face of any bearish patterns or opinions to sell resistance. And resistance has become support as shorts are proven wrong.

And HEY you might be, at the same time, profiting on the short side with your great r/r setups that you spot. There are plenty of issues out there that a dropping and making bear money. That's the case even when the market is hitting solid SUPPORT areas or breaking resistances. The weak ones will fall........... just like the strong ones flying through and away from resistances.........like the aggressive Qs play I made. They are up 122% from entry and growing as I speak.

So to sum up, sometimes trading is doing the opposite of what 'feels' right and sometimes it's about buying resistance. And the sooner every newbie trader can get that into their head (and the more that's reminded to us old dogs) the better. Our feelings are OFTEN wrong and we must act according to our own disciplines, according to the rules and limits we set. The market can't set those rules for us. It's the ONLY thing we have control of; our entries and exits. I have strict rules about entries and exits. And when I break one of them I give myself an uppercut and try not to do it again. But I guarantee you that giving an uppercut for my buying resistance is unwarranted. It's been a very clever play. Being aggressive has worked.

But dmk, you do have a good point about resistances. And that point of resistance should always be at least considered before one takes a trade either way. And if the setup is so good you trade against the general rule, and the r/r is nice, then great, take the trade and smile either way it goes.

[New-born baby]

Aci

Spike,
Do you think ACI will retrace Wednesday? I am seeing the FIB line at $75.38 for the retrace of the recent move downward, and I figure that is going to prove to be resistance. In short, I expect a pullback tomorrow. Would you agree?

Thanks!