11-16-14 Trade Plan

The markets had another week of up trending and stocks continue to push higher.  Specifically the NASDAQ is moving higher with the S&P and Russell having a week of consolidation.  We are still in a good environment for stock setups and still in a place of pushing winners and taking new signals as they come.  Like I said a few weeks ago this whole rally has been triggering lower time frame trends (which means quicker, more powerful trends) and they have been sustaining longer than most expect.

This is one of the reasons why I believe finding the time frame the trend has been/is being established on and just following the swing points is so effective.  It takes away any analytical emotion or uncertainty that may arise and leaves it up to you to either follow your rules or not, if that makes any sense.  That also includes removing any "fun" you may have trying to put the puzzle together with trend lines, fibs, overlays, chart patterns etc. and leaves you with much more consistency in my opinion.


The NASDAQ regained its 30m (or 15m) trend and left the week long consolidation to make new highs.  The IWM tried to do the same thing but ran into some supply at the previous daily high ($118).  Its swing points are still higher highs and lows though on the 65m trend it has been using for this rally.  The big support level is YTD break even & $115 area.  SPY held a consolidation this week in the 30m time frame and is still in an innocent trend higher.

The watch list still has a lot of names where winners are being pushed but there is also some that are potentially just getting started like TSLA, SBUX, TASR, AA, BA, & GRPN.  Usually when the indices are making short term tops (which we have no indication of now) stock setups tend to be non-existent while the indices show some weakness and that isn't the case right now.  I get that we are extended after a very sharp V shape reversal but I think sticking to the rules and waiting on evidence to act on is always the better play.  Thanks for reading

Trade well,
-Michael