Another first timer, thanks to RayW and I look forward to other Slopers submitting their thoughts, methodologies or any random tidbits they wish to share. Send to iggyslopefest at gmail dot com.
How to Build a Momo Stock Screen (Works Up or Down)
It’s all about the percentages, not about prices.
1. Using the FinViz.com screener first select Average Volume “Over 100K” per day.
This is to keep the bid/ask spreads as narrow as possible.
Greater volume means thinner B/A spreads, means a smaller fool’s premium paid to market maker for bid over ask.
Don’t just give away money on fat spreads of thinly traded stocks.
Greetings from the New Forest (established 1079 AD) in Hampshire, UK. The scenery and weather are lovely, and my internet connection is very slow, so I have been taking some genuine time off to relax rather than following the markets too closely. Things are looking interesting though so I thought I’d take some time today to do two posts, one on equities and the other later on on bonds, precious metals etc.
On equities SPX made a marginal new high last week and has pulled back sharply from that setting up a possible short term double-top. This isn’t the first time this has happened in recent months, so there isn’t much to get excited about as yet, but the overall setup favors at least some more downside this week, so I thought I’d have a look at that today. On the daily chart SPX tested the lower band on Friday and has gone lower this morning. There is double support in the 1956 area at the intersection of the lower band and broken wedge resistance, and primary support is at double-top support at 1952. A conviction break below double-top support would target the 1914 area. SPX daily chart:
These last two weeks feels like a change in trend is coming. My signals are firing and failing, and I must step down in time frames to squeeze out profits. From a macro perspective it seems to make sense, the heroin from the FED is slowly drying up, and the Fed to SPY ratio says that SPY already hit the theoretical price that the final Fed Balance sheet will reach.
Volatility has refused to go down, and the dollar is up, which informs me that big money is getting defensive and this takes another funding source away from the index algos.
Small caps and commodities are struggling, and gold, silver, and miners are trying to reestablish themselves but no big moves so far. (more…)
The perma-rally in the stock market is getting thinner and thinner, both in terms of breadth and daily range. Just take a look at the Dow Jones Composite; this wedge is getting ungodly tight. I realize anticipating a break has been like Waiting For Godot, but I continue to hunt down the best individual short positions, stock by stock – - – the domestic ETFs offer, in my opinion, almost no edge right now.
Given the yet-another-record-high on Chipotle today, I was curious if there were any bears left at all on this (even I’m not crazy enough to short the likes of CMG). Although short interest has declined (understandably), there’s still a pretty stunning amount of victims:
Although the daily magical levitation continues across the equity markets (in spite of the world going to hell in a handbasket), I’d like to meekly point out that the mid-cap index is playing with fire. Take note of recent action, and in particular pay attention to that red support trendline.
Since the end of 2012, the bears have been pathetically weak on every timeframe over hourly. It looked like they might have recovered some mojo on Thursday, but the strong rejection of those lows on Friday, with the close back over both the daily middle band and the 50 hour MA, killed off that impression fairly effectively. While SPX is making lower highs the bears aren’t entirely out of the game, but unless we see the 1952 low taken out, it seems a reasonable assumption that SPX is just consolidating in a range before the next move up. (more…)