07-20-14 Trade Plan

The market is still in a strong uptrend and nothing is getting in it's way.  Even I wanted to see some kind of pull back during the week due to the lack of setups and I thought we were seeing one, but again as soon as we touched that rising 130m trend we bounced right off of it and that's where we are now.  The Russell is still not looking good though with 130m and 65m trend both heading lower and it's now negative on the year with big resistance at $115.


What this tells me is that I want to stay away from the small cap momentum names associated with the Russell 2000 and this is confirmed when you look at the supporting trends of those stocks.  I want to be paying attention to names with good setups that are associated with NASDAQ preferably and the S&P.  No one knows how much longer this trend in the indices is going to last so it is best to be prepared for the trend to continue using reasonable stop losses.

I'm gonna do something different for the sector part of the post this weekend and see how you all like it.  Going through each stock setup is just too much to do here each week but since most of you know how I arrive at these watch list names, I will just make sure my watch list is updated every Friday afternoon and post it here.

It is separated into three sections: ETFs, long, and short.  The short section is empty for a reason, we are in bull markets with strong supporting trends across every major index.  If we start seeing some down trends in at least two of the indices, then the short section will be used.

So as you can see there are four sectors in the list this week; XLK, XLY, XLV, and XLF.  They are all represented in the watch list except for financials, not many setups there but the sector ETF does look pretty good.  There are also a few industrials and materials in there, which are strong S&P names.  The same exact process I use on the indices, I use on the stocks.  As always, thanks for reading and see you Monday.

Trade well,
-Michael