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Steve's Trading Diary - February 2009


2/27 AFL was not bought. After the gap on Thursday it gapped back down on Friday with the weak market.

2/19 Bought BEAT on the positive open. We expected it to show a strong move and it did. Continue to hold until you see a sell signal. 2/20 It continued its uptrend. It consolidated first thing in the morning on Friday but came right back up. Continue to hold until you see a sell signal. Use a close below the halfway point of Friday's large bullish candle as your sell stop. 2/23 It's getting a little bit toppy but it's still holding up. Continue to hold. We don't want to see it close more than halfway down Thursday's large bullish candle at around the $26 area. 2/24 It's still toppy but is still holding up. Continue to hold. We don't want to see it close back below the halfway point of Thursday's large bullish candle. 2/25 It closed right at the halfway point of Thursday's large bullish candle, which makes this a very simple decision on Thursday. Close it if it opens lower and continue to hold if it opens higher and trades higher on the day. 2/26 It closed right on the T-line. This one must open higher and trade higher on Friday to continue to hold. If it opens lower, close out the position. 2/27 It was closed out on the lower open on Friday. It traded down quite a bit but came right back up to the top end of the trading range. It can be bought if it comes back up through Friday's high, which was also the T-line, at around $25.40. That would initiate a positive J-Hook type action.

2/27 Bought SIGM as it went positive. It had a decent day. It opened lower, traded up, and closed just slightly negative. It should be closed out if it closes below the T-line. It can be bought aggressively again if it opens above the 200 day moving average at around the $13.80 area on Monday.

2/27 Shorted MDVN on the weak open on Friday. We've made some good profits with this already. It did not support at the T-line as expected and continued down. It still has a lot of room to move to the downside, especially with the gap down through the T-line.

2/26 Bought SCOR as it traded up. Even though the market pulled back, it held up reasonably well. Continue to hold as long as it doesn't close below the T-line. 2/27 It traded a little bit weaker but stayed above the T-line. Continue to hold but if it closes below the T-line, close out the position.

2/23 Bought DPZ on the positive trading on Monday. It pulled back a little bit keep holding this as long as it stays above the T-line. If it starts trading higher on Tuesday, you will probably want to start buying it. 2/24 It traded off but came right back up again. It can still be bought if it goes positive on Wednesday, meaning above Tuesday's high of $6.67. 2/25 Continue to hold. It's trying to break out to the upside. We don't want to see it close below Wednesday's low. That would tell us the Bears are in control. Use a close below $5.98 as your stop. 2/26 It held up well on Thursday. It formed a Doji with the stochastics in an uptrend. This can be bought aggressively on a positive open on Friday. 2/27 It continues to act well, especially after the big Hammer signal a few days ago. Continue to hold and use the T-line as your stop.

2/18 Shorted WIRE as it traded mostly weaker on the day. It stayed below the T-line. Continue to stay short and use a close above the T-line as your stop. 2/19 It opened lower. Continue to stay short. We don't want to see it close above the T-line. 2/20 It did trade higher but didn't close above the T-line, which is the significant factor here, especially with the previous gap to the downside. 2/23 It's still trading lower. Continue to stay short. 2/24 It tried to rally, but didn't. Continue to stay short. This one is still too weak to close out as a short position. 2/25 Remain short. It's right on the 50 day moving average with a Doji. If it opens higher on Thursday, close out half the position immediately, and if it trades anywhere above Wednesday's high of $19.66, close out the complete position. If it opens lower, it should be all right for a few more down-days. 2/26 It opened higher but immediately started trading off. If you covered it, you can re-short it on a weaker open on Friday. 2/27 It was trading positive most of the day on Friday. In the oversold condition and at the 50 day moving average, this would have been a good place to start taking profits on off half the position. If this opens higher on Monday, close out the rest of the position. That would mean that an Inverted Hammer formed in the oversold condition right at the 50 day moving average and would require positive confirmation. The only way to stay short is if it opens lower and continues to trade lower on Monday.

2/20 S was not bought because it opened lower. However, it came back up near the close so it showed that the Bulls were still there. This is another example where the stock had a down day and then a Kicker day during the uptrend. Be ready to buy this anywhere above $3.25. If it comes back up through the close of Thursday, it would show us the Bulls were still in control of this trend.

2/19 Shorted SVR. It traded lower on Thursday but after hours it appears that this will be added to one of the indexes based on an announcement. It's trading higher.  If it opens higher and doesn't trade down immediately, close out the short position. 2/20 It was covered immediately on the positive open on Friday. Anytime you see a trend and then an announcement is made that moves the price in the opposite direction, close out the position immediately because there is a new change in investor sentiment.

2/11 Shorted WYNN as it came down through Tuesday's close after opening higher. Continue to stay short. Use the T-line as your stop. 2/12 It didn't do anything of any great magnitude. It was actually up $.30 on Thursday. Be ready to close it out if it opens positive on Friday. That would tell us it was bottoming here instead of heading down farther. 2/13 Even though it opened positive, it immediately went south on Friday. Continue to stay short. At this point we don't want to see it trade back up through Friday's high of $26.88. That would tell us there was too much bottoming action going on at this level. It needs to open lower and trade lower to continue to hold this short position. 2/17 It moved down farther, obviously with the help of the market. Continue to stay short. It could now possibly move down into the $20 to $17 area if it's moving in a trend channel. 2/18 It continues to move lower. Continue to stay short until you see a definite buy signal. 2/19 It continued its downtrend. Continue to stay short. 2/20 It should have been closed out on the positive open after Thursday's Doji/Spinning Top in the oversold area. When it opened higher on Friday and didn't show any weakness, it should have been covered, especially as it came up through the high of the previous day.

2/23 WRI was not bought. This is a perfect example of why you want to see bullish confirmation after a bullish signal. The Piercing signal was not confirmed on Monday. They came out with their earnings announcement, which was lower because of some write-offs. They didn't cut their dividend. This can still be watched. It's getting down to the point where it's producing a 20% dividend yield. Be ready to buy this on the next buy signal.

2/20 Bought RS on Friday as it came back up through the previous day's close. Notice how it used the T-line at support and bounced up from there. It should reach the recent highs. Then watch to see if it breaks out through that level.2/23 It was closed out on Monday because it formed a Bearish Engulfing signal and it closed below the T-line. For being a strong chart, it has now gotten too sluggish.

2/18 Bought MTRX on the positive trading on Wednesday. It closed slightly lower but used the 50 day moving average as support and formed a Doji. It hasn't shown a reversal but it needs to have positive trading on Thursday for us to stay in it. If it shows weakness on Thursday, you will probably want to close out the position and see what it does from here. 2/19 It's still moving up nicely. Continue to hold. It's in a Fry Pan Bottom pattern. Look for a breakout. If you see it gap up, buy it aggressively. 2/20 It consolidated a little bit on Friday but is still keeping the trajectory of the Rounded Bottom intact. However, it formed a Bearish Engulfing signal on Friday in the overbought condition. If it starts trading lower on Monday, especially below Friday's low of $7.17, close out the position. Use $7.17 as your stop. If it is still in a good Fry Pan Bottom type pattern, it should not break through that previous low. 2/23 It was closed out on Monday as it formed a "Two Dark Crows" pattern. This is a very strong bearish indication. This should have been closed out. If you still own it, be ready to close it out if it trades below the 50 day moving average at around the $6.90 level. Also, be ready to go short if it trades below that level.

2/24 THRX was not shorted on Tuesday. It opened lower but immediately traded higher with the morning futures trading higher.

2/24 MTRX was not shorted. It opened higher and traded higher.

2/18 Shorted PLCM as it came down through our sell stop after the Kicker signal. It's coming out of a Pennant formation. Continue to stay short. Look for it to at least come back down and test the lows. 2/19 It has formed three Dark Clouds after the Kicker signal. Continue to stay short. 2/20 It traded lower. It tried to trade up during the day then came back down. Continue to stay short. At this point use Friday's high of $13.66 as your stop. 2/23 It opened slightly higher but immediately started trading off. It's still being affected by the previous Kicker type signal. 2/24 It formed a Bullish Harami. It should have been closed out on Tuesday with it opening higher and not trading below where it opened all day long. It can always be re-shorted if it comes back down through the halfway point of Tuesday's bullish candle.

2/25 RCL was not bought on Wednesday. However, notice that it closed right at the 20 day moving average. Be ready to buy this on a positive open on Thursday, at anything above $6.84.

2/25 TTEC was not bought on Wednesday. It opened and traded lower. It can still be bought if it comes back up through Wednesday's high of $9.60.

2/26 OVTI was not bought because it opened and started trading lower, failing the J-Hook/Fry Pan Bottom pattern.

2/13 SQNM was not bought because it opened lower and really didn't trade higher at all on Friday. However, you can still use Thursday's close at around $17.20 as your buy stop. If it comes back up through that level, you can start buying. That would show that the previous strong Belt Hold signal was confirming.

2/12 Bought SVNT on the positive open on Thursday. It did exactly what we expected after a series of Doji signals and a strong move to the upside. The first target is the recent high. It should run another four or five points after that. Use the T-line as your stop. 2/13 It should have been closed out immediately on the gap down open. At the end of the day it did move positive, so keep an eye on it. You could possibly buy this one back on a positive open seeing that it used the 50 day moving average as support. If this opens positive on Tuesday, you might consider adding this position back. There is still some good upside potential if this one moves positive on Tuesday.

2/17 SNCR was not bought. It opened at the lower end of the trading range, tried to move up, but closed back down at the lower end of the trading range. It can still be bought if it comes back up through Friday's close at around the $10.25 area. Trading up above that level would tell us the Bulls were back in control in this upward pattern.

2/17 AGU was not bought. It didn't open higher to break out of the Cup and Handle type pattern. It actually formed an Evening Star signal with an Abandoned Baby. It can be shorted if it opens weaker on Wednesday.

2/12 Bought PFWD on the positive trading. If you didn't buy it, buy it aggressively on a positive open on Friday. The first target is the recent high. If it breaks out through there the next target is the trend line area. 2/13 It's still moving positive based on the previous Belt Hold signal. Continue to hold as long as it doesn't close below the T-line. 2/17 It traded lower on Tuesday after Friday's Doji but it formed another Doji. It stayed above the 50 day moving average but it probably should have been closed out. If you didn't close it out, it needs to open higher on Wednesday and trade positive. It can't close below the 50 day moving average to continue holding it. Close it out on any weakness on Wednesday.

2/5 Bought NLC on the positive trading. It opened and moved lower on Thursday but then came up near the end of the day. It can still be bought on positive trading on Friday. 2/6 It continues to move up nicely ever since the gap up. Continue to hold. Anticipate at least a test of the recent high and possibly much higher. 2/9 It formed a little Doji. It might start trading off. Use Monday's low of $12.03 as your stop to take some profits. 2/10 It's getting a little bit toppy. If it opens lower on Wednesday, close out the position. It's stalling out at the same level where it stalled out before. 2/11 It pulled back, held at the T-line, and bounced back up. It needs to open and trade higher on Thursday to continue to hold. Continue to use the T-line as your stop. 2/12 It bounced off the T-line and closed up slightly positive. It can be bought aggressively on a positive open on Friday. 2/13 It's still trading up above the T-line. This definitely needs to have a positive open on Tuesday and trade higher. If it closes below the T-line, close out the position. 2/17 It should have been closed out on Tuesday as it closed below the T-line.  It's rolling over.

2/3 Bought HRZ on the positive trading on Tuesday. It traded up and pulled back so it definitely needs to show positive trading on Wednesday in order to break out through the recent high levels. We don't want to see it close more than halfway down Monday's large bullish at around the $3.75 area. 2/4 Although it pulled back a little bit, it's still holding up pretty well. Continue to hold. It definitely needs to have a positive open on Thursday. 2/5 It continued to pull back. It closed above the T-line. The 2-day moving average is starting to roll over. It needs to open positive and start trading positive. We don't want to see it trade back below Thursday's low of $3.61. If it comes back down through that level the third time, it tells us the Bears are in control of this trend. 2/6 Be ready to buy this aggressively on a positive open on Monday. If it breaks out through the recent high levels, it will probably reach the $6.00 level fairly easily. 2/9 It's still showing a very good chart set-up. Be ready to buy this on a positive open on Tuesday. 2/10 Continue to hold. Use a close below the T-line as your stop. 2/11 It's still holding up. It can be bought aggressively if it comes up through Wednesday's high of $4.22. That would start the next wave up pretty aggressively. 2/12 It formed a big Spinning Top on Thursday. It closed positive, up $.04. It can be bought on a positive open. It didn't close below the T-line but it was a little scary on Thursday. If you were stopped out on Thursday, you can get back into it on Friday on a positive open. If it breaks out from this level it has a good possibility of running up another couple of points. 2/13 It showed good strength on Friday. It might be getting a little bit toppy but continue to hold as long as it doesn't close below the T-line. 2/17 It closed below the T-line and should have been closed out on Tuesday.

2/18 Bought MDT on the positive trading on Wednesday but it pulled back near the close. We advised that if it closed lower on Wednesday than where it opened to close it out, so if you closed it out that's fine. Be ready to buy it back on any positive trading on Thursday. If you didn't close it out, it needs to have positive trading on Thursday to continue to hold. If it opens lower, close out the position immediately.

2/13 Bought DW on the positive open. It did not resist at the T-line after the big strong Hammer signal. This can still be bought. Use a close below the T-line as your stop. 2/17 Although it traded lower it did close above its open and traded right on the T-line. Continue to hold. It just needs to close positive on Wednesday. If it closes negative, it would be telling us the T-line is acting as resistance. 2/18 It should have been closed out on Wednesday as it showed that it was failing the T-line.

2/11 Bought LNCR on Tuesday on the positive open after the big Belt Hold signal and with it hugging the 50 day moving average. Continue to hold and use the T-line as your stop. 2/12 As illustrated in Thursday's newsletter, this shows why we don't care what the markets are doing when you have a strong Belt Hold signal. It washes out all the sellers and takes it up strong. Continue to hold. Watch what it does when it gets up to the recent high levels. 2/13 It gapped down on the open on no news at all. It traded down a little bit but started moving up immediately. This would have been a case where, if you were nimble and closed it out, you could have bought it back as you saw it starting to move positive again. The Belt Hold signals are showing that a lot of the sellers are getting washed out of this position. 2/17 After the Belt Hold signals it's now producing a very "iffy" chart. If it opens lower and starts trading lower on Wednesday, close out the position. You can always buy it back if it starts moving in an uptrending channel. 2/18 We advised that you should have closed this out if it opened lower and started trading lower, which it did. If you closed it out, be ready to buy it back on a positive open. It bounced off the 50 day moving average and came back up, so if it opens and starts trading above the T-line you can buy back into it. This is one of those situations where, if the chart was looking junkie and you didn't know which way it was going, you should have gotten out of it until it confirmed which way it wanted to go.

2/4 Bought SWWC on Wednesday on the positive trading. It's still forming an obvious Fry Pan Bottom pattern. Continue to buy this as long as it continues in an uptrend. We're expecting a breakout pretty soon. 2/5 It's still moving up nicely out of the Fry Pan Bottom. Continue to hold as long as it closes above the T-line. 2/6 It consolidated but didn't do anything worrisome. Continue to hold as long as it doesn't close below the T-line. 2/9 It opened lower on Monday, which meant we probably would have wanted to take some profits. Then it closed up near being even on the day. If you closed out any part of this position, it can be bought back on a positive open on Tuesday.  If the trades lower, close out any remaining position and wait to see if it will bounce off the T-line. 2/10 It formed a Fry Pan Bottom and now looks like it may be forming a little "handle". Be ready to close this out if it closes below the T-line. Continue to hold as long as it stays up above the T-line. 2/11 It's still coming out of the Fry Pan Bottom pattern. It's forming a little hook here. Be ready to buy this aggressively, especially if it comes up through Wednesday's high of $5.43. If it comes up through that level, it tells us the Bulls are back in it and ready to start the next wave up. 2/12 Be ready to buy this aggressively on a positive open. After the Fry Pan Bottom pattern and a little "handle" be ready to buy this, especially on a breakout. 2/13 It can still be bought coming out of the Fry Pan Bottom / J-Hook pattern.  It still has probably a good 1 and a half or 2 point move in it. Continue to use a close below the T-line as your stop. 2/17 It closed just below the T-line. It should be closed out on any weakness on Wednesday. It needs to open higher and trade higher to stay in it. Be ready to close it out immediately on any weakness. 2/18 If you closed this out, it's all right. If you held onto it, continue to hold but it needs to open and trade up above the T-line on Thursday. It's not really falling apart at this level, it's just moving sideways.

2/19 Bought GRS on the positive trading on Thursday but it was closed as it closed back on the 200 day moving average. It needed to perform stronger to maintain this position. If it opens higher on Friday, it can always be bought back again.

2/19 MMR was not shorted because it didn't close lower until late in the day. If it opens weaker on Friday, you can go short.

2/9 AFAM was not bought. It opened higher but immediately started trading off. However, be ready to buy this on a positive open on Tuesday. It could move right back up again.

2/10 MEOH was not bought since the markets opened lower. It opened, flopped around a little bit, and then started trading off. However, notice that it closed right on the T-line so if it opens higher on Wednesday, start watching for it to move back up. That's when you can start buying.

2/10 PL was not bought. It opened way down at the lower end of the previous day's candle and went in the opposite direction.

2/9 Bought BAC on the positive open on Monday. It has a very nice chart. It's staying up above the T-line. It can still be bought. This one has the potential of moving up to the 50 day moving average or filling the previous gap, which could essentially double your money. 2/10 It opened and traded down on Tuesday. It should have been closed as it closed below the T-line. However, this is the type of situation where if you didn't close it out, hold it for one more day and see if it pops back up. Because of the strength of the previous buy signal, it may come back up. This will be a good trade on Wednesday if it opens positive and starts moving up. If this happens, you can start buying it aggressively. It may start moving back up strong on Wednesday.

2/9 Bought NGLS on Monday on positive trading. It can be held or even bought again on a positive open on Tuesday. It shouldn't close below the T-line to continue to hold. 2/10 It closed below the T-line and should have been closed out. Not only did it close below the T-line, but it formed a Bearish Engulfing signal. This means it could move down a little bit farther.

2/6 Bought NUAN on the positive open. It had a very nice day. Continue to hold. There is lots of upside potential for this stock, both fundamentally as well as technically. 2/9 It consolidated a little bit but held up well. Continue to hold. We don't want to see it close below the T-line on Tuesday at around the $10.50 level. 2/10 It took a hammering on Tuesday. It sold off very hard. It should have been closed out with it closing below the T-line, but watch for a positive open. It looks like the traders reacted too strong. Be ready to buy this on a positive open on Wednesday. It will probably start moving right back up.

2/4 Bought GFA. It opened higher but closed back down at $10.96. Give it another day to start moving up. If it opens lower on Thursday and doesn't close above $10.96, close out the position. 2/5 It traded positive most of the day. Continue to hold. It can be bought aggressively on Friday if it opens positive and starts moving up. 2/6 We are reiterating a buy of this stock. If it opens positive on Monday, buy it aggressively. It's still in a Fry Pan Bottom set-up. 2/9 It's getting a little bit toppy. Use a close below the T-line as your stop. 2/10 It closed below the T-line after a previous Dark Cloud signal. It should have been closed out. It may have formed a Double Top.

2/6 Bought PALM on Friday as it opened higher with the market. Continue to hold. Use the T-line as your stop. We're anticipating that if a Rounded Bottom pattern is forming after wave two, then wave three to the upside should be substantial from this level. 2/9 It formed a Bearish Engulfing signal. It stayed up above the T-line. It needs to trade above the T-line on Tuesday to continue to hold. 2/10 It traded off a little bit on Tuesday. It closed pretty close to the T-line but had an indecisive trading day. This makes the analysis fairly simple. If it opens lower on Wednesday, close out the position and wait for the next buy signal. 2/11 It opened lower Wednesday morning. It should have been closed out. However, with the Bullish Engulfing signal right on the T-line, it can be bought back on Thursday on a positive open.

2/12 IR was not bought on Thursday. It opened lower and traded lower. It can still be bought if the price comes up through Wednesday's close. That would tell us the Bulls are back in control.

2/11 Shorted STAR as it came down through Tuesday's close. However, it closed higher and formed a Doji. This needs to be closed out if it trades positive and closes above the T-line. To stay short, it needs to open lower and trade lower on Thursday. 2/12 It was closed out when it went positive on Thursday, especially as it moved up above the T-line. That's where this short position should have been stopped out.

2/2 SPWRA was not bought on Monday. It opened lower and traded down.

2/2 ARBA was not bought. It opened lower but came back up close to being even. It's still forming somewhat of a Fry Pan Bottom/Cradle type pattern. If it trades up above Monday's high of $7.69, it can be bought.

2/3 Shorted BBBY on the early weakness but it definitely should have been closed as it closed above the high of the previous day.

2/2 Shorted LNN as it traded weaker on Monday. Continue to stay short but we don't want to see it close above Monday's high of $27. 2/3 It continued to trade down. It stalled a little on Tuesday with the positive trading in the markets. If it starts showing strength on Wednesday by coming up through the 2-day moving average and Tuesday's high of $26.40, close out the position. 2/4 It opened higher and should have been stopped out with it coming up through the $26.40 level. It can still be shorted if it comes back down through Wednesday's low of $26.05. If it comes back down through that level, you can continue shorting it.

2/5 EXM was not bought on the positive open on Thursday because the market opened and started immediately heading down. If you did buy, it's still all right. We just need to see it open positive on Friday. If you didn't buy it, be ready to buy it if it comes up through Thursday's open of $8.10. If it comes up through that level, it shows confirmation of the gap up from the little Hammer signal.


 

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