Our signals are a proprietary scan of the S&P 500 and NDX 100 stocks designed to identify pullbacks within an existing trend for optimal trade entry and risk management.
These are setups we will be trading in our fund. You can observe our trade management of the signals on StockTwits, and Twitter as each trade evolves.
The signals are based on the work of Mr. Steven Primo who is a friend, Veteran Stock Exchange Specialist, and mentor of ours since 1986.
The index scan may produce upwards of 25 signals. The signals we ultimately choose fit multiple criteria we like to see for our trading style, including sector criteria and our risk tolerance. You can learn more about Mr. Primo’s work @ Specialist
At Bikini Analytics we are laying out a big picture of where we see the market headed (lower). This morning we posted a 30 year view of the NYSE Primary Exchange Index with long-term bearish implications titled 100 Year (Stock Market) Storm?
We want to stress to readers that is a MONTHLY chart, working on a topping formation since 1997! That said, we are no less bearish on our market outlook.
But, as traders we have to keep in mind that markets do not move in a straight line. Bear market rallies can be brutal. Their typical characteristics are moves that are up quick, sharp and steep, lasting one to three days on low volumes.
The big picture is clear. To navigate it successfully, we have to follow the short-term road map or risk poor trade entry and stop management that can wipe us out.
The $VIX is down 8.9% as I type. It is suggesting the market has some short-term bounce potential.
VIX – Daily
SPX – Daily
VIX – Weekly
Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)
On October 09, 2012 Edwards Lifesciences (EW) dropped 21% after the company lowered guidance warning that austerity measures in Europe and lower insurance reimbursements in the US would hurt Q3 sales.
The company threw hopeful bulls a bone, with CEO Michael Mussallem saying they “anticipate a strong rebound in the fourth quarter”
Sounds like a slope of hope to us. From our experience, it is safer to listen to what the stock says, than what company management says.
Noting the gap overhead, and knowing how the market hates a void, our bet is the stock wants to fill its spring 2012 gap @ 74 before it tries to workout the giant hole it just left in investors pockets above.
We see a lot of trapped longs and doubt they will be hanging around to see if Mr. Mussallem’s reassurances of a Q4 rebound bear fruit in this market environment.