Hello fellow traders everywhere! Adam Hewison here, co-founder of MarketClub with your mid-day market update for Tuesday, the 31st of January.
Here's a trading tip: Never, ever buy something because it looks cheap.
We will examine RadioShack (RSH) and see what led to today's disastrous loss. It's a lesson every investor needs to know.
Three stocks on our radar screen today:
EDWARD LIFESCIENCES CORP (EW), MATTEL INC (MAT), and BEST BUY CO INC (BBY).
Did MarketClub's Trade Triangle technology get it right for these three stocks?
Always remember …
DON'T FIGHT THE MARKET … MOVE WITH THE MARKET
Now, let's go to the charts and MarketClub's Trade Triangle Technology.
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S&P 500 INDEX
BIG PICTURE: Emerging Trend +75
TRADE TRIANGLES: Long-Term = Bullish | Intermediate Term = Bullish | Short-Term = Bearish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
We are looking for more consolidation in the S&P 500. However, it looks like the index will close out the month of January on a positive note. Longer-term we expect this market to move up to the $1370 to $1380 level as early as May based on cyclic work. With two of our Trade Triangles green, a bull market is underway. Long and Intermediate term traders should now be holding long positions in this index with appropriate money management stops.
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Watch today’s S&P 500 Video Here.
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Suggested S&P 500 Trading Instruments:
Non Leveraged ETF’s: (Long SPY) (Short SH)
2 x Leveraged ETF’s: (Long SSO)(Short SDS)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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SILVER (SPOT)
BIG PICTURE: Trading Range +60
TRADE TRIANGLES: Long-Term = Bearish | Intermediate Term = Bullish | Short-Term = Bearish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
The silver market ran into a heavy line of resistance at $34 today and the subsequent market action could be the beginning of an interim top. We think this market is at the top of a trading range cycle, but has not provided conclusive proof that the cycle has indeed topped out. With our long-term monthly Trade Triangle red, we expect to see this market run out of steam around current levels. This particular indicator has done extremely well in the past. With a Chart Analysis Score for silver at +60, silver is now officially in a trading range. Long-term term traders should be in short positions in silver with appropriate money management stops. Intermediate term traders should be on the sidelines.
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Watch today’s Silver Video Here.
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Suggested SILVER Trading Instruments:
Non Leveraged ETF’s: (Long SLV) (Short the ETF SLV)
Leveraged ETF’s: (Long AGQ) (Short ZSL)
Futures & Options: Contracts are available to trade this market. Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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GOLD (SPOT)
BIG PICTURE: Trading Range +60
TRADE TRIANGLES: Long-Term = Bearish | Intermediate Term = Bullish | Short-Term = Bullish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
The gold market came very close to the $1750 resistance area that we outlined in yesterday's post. We still feel that this market is at a turning point and that we'll see more of a two-way market with a downside bias. The spot gold market is now officially in a trading range with a Score of +60. That factor along with our negative monthly Trade Triangle continues to act as an inhibitor for this market on the upside. Long-term term traders should be in short positions in gold with appropriate money management stops. Intermediate term traders should be on the sidelines.
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Watch today’s Gold Video Here.
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Suggested GOLD Trading Instruments:
Non Leveraged ETF’s: (Long GLD) (Short the ETF GLD)
Leveraged ETF’s:(Long UGL) (Short GLL)
Futures & Options: Contracts are available to trade this market. Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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COPPER (MARCH)
BIG PICTURE: Emerging Trend +75
TRADE TRIANGLES: Long-Term = Bullish | Intermediate Term = Bullish | Short-Term = Bearish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
Look for the copper market to find good support at $3.70, extending down to $3.60. The trend for this market is longer-term bullish. The copper market has fallen back to a Score of +75, indicating that an emerging trend is beginning to take place. As we have said in the past, copper generally reflects economic conditions, and as such is influenced by equity prices. Look for support to start at the $3.70 level. The market action looks as though it has created a large base to move higher in the future. Upside target zone for copper is $4.00. Long and Intermediate term traders should now be holding long positions in this index with appropriate money management stops.
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Watch today’s Copper Video Here.
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Suggested Copper Trading Instruments:
Non Leveraged ETF’s: (Long JJC)
Futures & Options: Contracts are available to trade this market. Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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CRUDE OIL (MARCH)
BIG PICTURE: Trading Range -55
TRADE TRIANGLES: Long-Term = Bullish | Intermediate Term = Bearish | Short-Term = Bullish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
With a Chart Analysis Score of -55, the crude oil market continues to march sideways in a trading range. We still remain longer-term positive on this market and expect to see it make new highs soon. However, it must move over resistance at $102 and $104 levels to get its upside momentum into high gear. With our daily and monthly Trade Triangles in positive modes, we expect we will see further market consolidation in crude oil. Long-term traders should be long this market with appropriate money management stops.
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Watch today’s Crude Oil Video Here.
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Suggested Crude Oil Trading Instruments:
Non Leveraged ETF’s: (Long USO) (Short the ETF USO)
Leveraged ETF’s: (Long UCO) (Short DTO)
Futures & Options: Contracts are available to trade this market. Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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DOLLAR INDEX
BIG PICTURE: Trading Range -60
TRADE TRIANGLES: Long-Term = Bullish | Intermediate Term = Bearish | Short-Term = Bearish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
The dollar index reversed course today from the $78.75 area that has provided support for the last four days. With a Chart Analysis Score of -60, this index is now officially in a trading range. Our longer-term monthly Trade Triangle remains in a positive mode, indicating that higher prices should be on their way. This mixed picture could also mean we will see a pullback to the $78.22 level and the $77.38 level. Both of these levels represent Fibonacci retracement points of 50% and 61.8%. Long term traders should maintain long positions with the appropriate stops in place.
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Watch today’s Dollar Index Video Here.
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Suggested DOLLAR INDEX Trading Instruments:
Non Leveraged ETF’s: (Long UUP) (Short UDN)
Leveraged ETF’s: (Long) (Short)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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REUTERS/JEFFERIES CRB COMMODITY INDEX
BIG PICTURE: Emerging Trend -75
TRADE TRIANGLES: Long-Term = Bearish | Intermediate Term = Bullish | Short-Term = Bearish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
This index broke below a trend line that began in mid-December and we believe it has negated the potential head and shoulders formation we were looking for. The next level of support is around the $306 area. With a Chart Analysis Score of -75, this market is in an emerging downtrend. Our longer-term monthly Trade Triangle continues to be negative for this index. Somewhere along the line, this trend will change and we believe it will be an important turning point in the inflation spiral that could be waiting for all of us. Long-term traders should hold short positions in this index with appropriate money management stops.
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Watch today’s REUTERS/JEFFERIES CRB COMMODITY INDEX Video Here.
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Suggested REUTERS/JEFFERIES CRB COMMODITY INDEX Trading Instruments:
Non Leveraged ETF’s: (Long CRBQ) (Short the ETF CRBQ)
Leveraged ETF’s: (Long) (Short CMD)
Futures & Options: Contracts are available to trade this market. Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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This is Adam Hewison for MarketClub and I'll be here tomorrow with my daily update. Have a great trading day.
Take care everyone,
Adam Hewison
President INO.com and co-founder of MarketClub.com
I got burnt on Radioshack. Although now it looks like a strong sell.
@kenny >>>> Natural gas is cheap and may go up (it has started to do so already) as U.S. mining companies stop gas exploration because of low price of gas - which should lead to some rise in prices...(cannot speak for Russia and other gas exporters though.)
Here is an article about large North American companies stopping the drilling for gas:
http://news.businessweek.com/article.asp?documentKey=1376-LY9P6S6K50Y601-6KHPKT5FQ2SIATCT792ULUSPR7
about UNG cheap its good buy its yes or no let me know thanks, kenny