08-24-14 Trade Plan

It was another week of up trending and some very aggressive price action as well.  There really hasn't been a swing low since last Friday (15th) when the big sellers came in.  This is price action going straight up, it does happen in this market at least.  Every single time we get a bounce off the lows we go straight up like this holding 15m trends with few to no major swing lows, and every time you have people going crazy during market hours.  People going crazy because "this price action is so great" and people going crazy because "the bulls are kicking our ass" and everyone is always seemingly surprised.

People tuned out of the noise reading price action objectively don't go crazy with the crowd, and the understanding of price paired with preparation makes being surprised not part of the equation.  It comes across as boring, un-involved to newer traders because there is a huge emotional party going on that we don't participate in.  I used to play that game as well, until I realized it was a psychological barrier to the level of trading I want to get to.  Turn off the CNBC forever, it's a drug.  I haven't even seen that flower logo thing in over 6 months, maybe longer.  Look at things from the outside in and everything becomes very clear.  Pick up a hobby for the down time you have during positions.  Ok time to get back to the regularly scheduled program..


SPY and QQQ have been holding 30m/15m trends for two weeks now since that first swing low was put in (8/12) to start the reversal so those will hold if we are going to continue straight up.  Even if they turn back lower the 130m trends shown above are reversing (SPY & IWM) or continuing (QQQ) so there is back up there.  Since we haven't had a swing low in a long time any pull back is subject to a higher low after a higher high.  IWM is really looking great for a breakout through multiple resistance areas with the 130m trend in place and currently holding a 65m trend.  IWM stocktweet

Still a lot of the same stocks from last week but I've added some financials and took out some names that just weren't performing.  GILD CELG NFLX YHOO were some great ones from last week.  I wasn't in EBAY but it was on the watch list when it made that huge move which isn't uncommon for these huge moves to take place in the direction of the trend.  A lot of trend followers view that as part of the trend and I wouldn't disagree.

Some of these industry ETFs are also starting to look good, TAN IBB XRT looking for some intraday trends to use.  The bonds are finding buyers at the 130m trend again.  That's about all I have for this week, just the same as always I will be looking for actionable intraday trends with good looking daily charts.  If you are using these intraday trends with the 50 period average to confirm the good looking daily chart, you don't even have to be any good at picking daily charts.  Because you would be defining risk based on the intraday swing points in the trend any way.  How the daily chart looks is just an added bonus, but the intraday trends is what can carry your position through weeks of noise.  This is why I have become a lot more open to trading bottoms where the 50 day average is still slightly declining and price is trying to break through it (EBAY for example back in mid July) because I'm using intraday trends that can hold for weeks and months at a time.  On top of that with indices up trending that is putting force on the entire market, some stocks are stronger than the others but none are really crashing and if they are [crashing while indices are up trending] they aren't really worth watching for my approach.  I realized this year that it isn't about being the best at any particular thing, though it's good to know your strengths and weaknesses, it's about a simple big picture puzzle that comes together all the time and you just have to put it together and manage the risk.  Thanks for reading all of this I guess I had a lot to say this weekend lol

Trade well,
-Michael